Today's video focuses on tips and tricks I follow as a long-term investor when stock prices go down and volatility remains high. Here are some highlights from the video.
- Understand that investment portfolios are not all built the same. Mega-cap technology companies like Microsoft (NASDAQ:MSFT), Apple (NASDAQ:AAPL), Nvidia (NASDAQ:NVDA), and Amazon (NASDAQ:AMZN) have dropped by only single-digit percentage points from their all-time highs. Then you have high-growth stock portfolios with companies like Sea Limited (NYSE:SE), Teladoc (NYSE:TDOC), Palantir (NYSE:PLTR), and Unity Software (NYSE:U), which have all dropped between 25% and 65% their from all-time highs.
- Remember that the dip in prices can continue and last longer than anyone expects. For that reason, if I tend to buy the dip, I do it via a dollar-cost-averaging method. This protects me from getting too emotional if I accidentally bought in the early innings of the plunge.
- I try to find ways to increase the amount of money I can invest during these volatile times. There are two ways to do this: by decreasing expenses and by increasing earnings.
Click the video below for my full thoughts and analysis.
*Stock prices used were the pre-market prices of Dec. 2, 2021. The video was published on Dec. 2, 2021.