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I've had a really good week despite being down a few hundred dollars actually one percent down for a week is not a big deal I'm I think what happened is. Read Scott hit pretty hard as well as health care I think Good Friday because the stock market was closed during that day made it so there it wasn't a whole lot of chance to rebound but we'll see what happens Monday REITs and these different ones could continue to go down if that's the case I think they will. Get to a level where people will start buying into real estate start buying into utilities they drop too low the yields. Will go up higher and there'll be people that are just waiting to. Buy in so that's my guess of what's happening but regardless I'm not too concerned about being down a few hundred bucks in fact. It might be nice for it to go lower so people trying to buy in right now can get a better entry point I did want to give you a quick outline over today's episode because I have a. Lot to go over the first thing is I'm going to be starting off rather than jumping right into the financial sector I'm gonna be going through my favorite dividend ETF exchange-traded funds I'll explain what those are and then what ones I believe are the best for dividends because I haven't asked this numerous times and I was. Actually just asked a few minutes ago again so I'll go over that the next thing I'll do is I'll go through the financial sector review and talk a little bit about that after that the m1 finance team they. Did this whole AMA on reddit and so you can look at this and I'm gonna be giving my reaction to a lot of the questions that. Were asked in the answers that they give because that's a big thing for me the brokerage that you're seeing is m1 Finance and that is a that's the one that I use is. Someone that I like using so I'll be responding to their am a rather reacting to their AMA and then after that I'm gonna be talking a little bit about the news actually. Just one item on it I mean we're talking about venmo and their efforts and becoming profitable and about companies that are non profitable for very long periods of time and my thoughts on that and then I'm gonna be answering some questions now before I jump into any of that. I wanted to talk about one thing real quick first and that is the my youtube homepage what's going on with the channel what my your plans are that type of thing so recently this channel got monetized which means that I can start earning money from different means from the YouTube videos now YouTube actually. Gives you like a few different ways of monetizing a video they have non skippable ads which are those 15-second ones that you can't skip at any point they have the overlay ads which are like little pop-up boxes at the bottom of the screen and then they have pre-roll ads which happen before you see the video and. All these different things they have like these different ones at the end that's advertise products on the side anyway there's a. Lot of different ways to monetize the videos what i did is i tried to go through after becoming monetized and pick what i think is. The least a true obtrusive options and so I'm not showing any of the videos that are unskipable I'm not showing any of the popover ones which are the ones that just pop up at the bottom of your screen as you're watching I personally think those ones are and I absolutely hate them because. When I'm when I'm done watching a pre-roll ad I want to be able to just watch it and not have this this little pop-up ad show and then you have to hit the tiny little X. On the top right and if you miss it you accidentally go to the website so I'm not I shouldn't have any of those on any of my videos I don't plan on putting any. Of those on it really the only ones that I plan on doing are just the five-second skippable ads so after five seconds you can skip them it's the. Most basic one that YouTube has and for like 30 or 40 minute videos I might have a. Couple of them in a video so I hope that's not too obtrusive that's what I plan on doing and I'll probably get better at at making a better experience for you guys so I hope it still remains a good experience for you guys anyways I'm on the youtube. Homepage here and I actually spent a little time doing a little housekeeping here I just wanted to go through it. Just 20 seconds the first thing is this this main video here is always going to be the most recent one that I upload the featured video appear underneath that is my main series so these are just the most recent uploads from the most recent hair to the oldest. Hair under that is the portfolio review videos so these are all different playlists that you can play this one every one where I'm reviewing a different sector of my portfolio like today's video is going to be right here those will show up on this playlist so you can find all of them here underneath that are in. My personal pics of what I think are probably some of the best videos I've done or the rather the most. Useful ones the ones with the most jam-packed information and I'm and then at the very bottom is the entire portfolio series all the episodes in chronological order so if you're new here like we just got a hundred and twenty subscribers in just yesterday I got. 120 subscribers so not even the past two days just one day there's been a lot of new people if you want to start the series from the beginning from the origin here just use this playlist it'll go right through it I think there's a lot of valuable information it's not all time-based so you don't have to. Watch all of it completely live when it came out I hope you guys enjoy this I'm going to be trying to make my YouTube page a little. Bit more useful in fact I'm thinking about clipping some of the information in some of the videos that I think is more useful and putting them into more bite-sized chunks and creating a playlist with that but I I'm still waiting on that we'll see what happens but anyways I just wanted. To mention them alrighty so moving on from that I want to go through what my favorite dividend ETFs are I had an interesting question come up. And I'm gonna throw it. Up on the screen his name is Christian Barnes and he commented saying new subscriber here who just found your channel after watching some other videos on divin growth investing and your channel has quickly become my new favorite I'm wondering what your favorite dividend growth ETFs and REIT ETFs are I work as. An attorney a large national firm and like most other large firms my firm has a policy that essentially prevents us from investing in individual securities to avoid. Running into any insider trading issues so unfortunately I'm limited to ETFs but still want to pursue this general strategy would love to hear your thoughts and some of your favorites ok so Christian I will share some of my favorites know if I look at this this also applies. I know that he's doing this because he's an attorney at a large firm they probably do business with a lot of. Other businesses and he could be in trouble for trading off of privileged information that the general public doesn't have so that's why he needs to invest in ETFs but. This isn't exclusive for people that just are prohibited from investing in individual holdings if you like this basic idea of investing but you don't want you don't feel comfortable the responsibility of picking individual Holdings that's fine you don't have to feel bad about that ETFs are a great way for you to be confident in your investments without having to. Go through the trouble of. Picking individual holdings I'll highlight a few. That I think are good that you can look at I'll start off with Vig this is one that always comes up when you're doing dividend growth appreciation this one I actually don't recommend to use at least personally I think it's a good fund but it just doesn't represent a high cash flow people looking for. Highly profitable companies that have so much money they don't know what to do with it so they just share it with their shareholders I just don't think this fund and the reason why is because look at the dividend yield one point eight. Seven percent so if I look at just the general stock market spy-1 point seven five one point eight seven two one point seven five to me that just I mean what's the point of investing in cashflow if you're barely. Above just a general the general market so I don't recommend this one it follows the same basic strategy but just. The amount of cash flow you're getting is too low for it to be interesting to me another one that's often mention is vym I think this is a better one than Vig if you're trying to do this type of strategy it looks for the. Same thing but it looks for for companies that aren't just growing their dividends but ones that already have pretty good yields and that's why even with 400 Holdings so it's it's highly diversified with 400 holdings but it still has almost a three. Percent yield which is pretty good like 1.2 percent better than the general market now I think there's a clear winner here and that is s PhD this is one that I hold it's 80%. Of my Roth IRA because it's easy you set it forget it that's what's great about ETFs I don't have to manage it at all but look at the dividend yield on this 3.9 1% now this is invest COEs S&P 500 high dividend low volatility ETF I'll go through and I actually want to draw out how this one. Works it's only 51 holdings but I still think it's it's really good I wanted to go through and actually draw out how it works because I think. It's such a good ETF here now what this one does is like I said it's only it's only 51 Holdings here what they do is they go through the S&P 500 and the S&P 500 is the 500 like largest cap companies. In the US so you have all these different companies in this list and what this fund does. Is they they look through the entire list here and they scan through it and they find the 75 highest yielding companies so the 75 companies with the highest dividend yield in the S&P 500 to be an SMP 500 they're usually pretty solid companies to begin with then you have. The 75 that are the highest yield then out of this group what they do is they go through and they back test it for volatility so if you have the companies here and their performance and it looks like this is exact they find the ones. That have the most consistently straight line not the ones that are going up and down radically once they organize it by the most volatile they remove. The 25 most volatile which leaves them with the 50 highest yielding least volatile companies in the S&P 500 and I think that's a pretty great methodology now if we look at their their details of the funds here I can go to the portfolio here and let me go down here to you all. Holdings I can show you and give you an idea of how this fund is weighted we have real estate making up the lion's share of it which if you haven't looked at my portfolio here real estate makes up. The biggest part of it then after real estate they have utilities which again is pretty close to what mine is and then it goes on with energy I have a little bit lower energy and then financials consumer staples communication consumer discretionary and health. Care is the smallest amount its heavily weighted towards these large corporations that are that don't have a whole lot of volatility compared to the rest of the market but this is generally what you're looking for they have always grown their. Dividend so if I go over here to seeking alpha so if I look at their actual history of debt and payments here they're not exactly growing it like a dividend growth tip company you typically would you know if you looked at Realty income corporate something like that but it's pretty consistent and it is gradually getting. Higher but the the great thing about this ETF they pay out monthly they pay out a high percent and it's very consistent if I look at the chart over one month they just have such consistent payments and if you're using a if you're using something like m1 finance every single month you can reinvest that and. Buy another partial share of this same ETF you're getting compounding all throughout the year rather than if you just bought vym and you only get those for during the year I like that they pay out. Monthly I like that it's a 4% yield I really like the methodology that they use a filtering through the seventy five highest yield and they find the lowest volatility or the highest volatility ones they rule those out leaves you with 50 solid. Companies that's the one I would recommend if you're wanting to have a portfolio that mimics mine by having a ETF I really like s PhD anyway moving on from that let's go into the financial sector review jumping into the finance PI here makes up 8% of my portfolio so if I. Go into it the overall yield of this with all the waiting's and all the holdings and this exact assortment is about 3.6 percent is what you're looking at is the overall dividend yield now some of them have a lot more than others I've kind of organized it that way Main Street capital has. A lot more than others and I've tried to diversify again within this sector of Finance I've tried to diversify. A lot I have some foreign banks the Canadian ones that weren't really hurt in the onine recession like these American banks were I have some of the old more old. Fashioned banking systems like JPMorgan and Bank of America. Wells Fargo I have some investment corporations where Main Street Capital Corporation T rowe Price they're both investment groups that they go out and offer financial products and do different financial investments and then I have some like insurance companies UnitedHealth. Aflac that do insurance Affleck does it for the u.s. and Japan it's pretty diversified throughout it you can see that some of. Them have been hit pretty hard down 20%. On UNH Wells Fargo has been hit I don't think the banking sector has been doing well overall in fact they just had like the most recent news was when all the CEOs were called to Capitol Hill to testify before Congress. And it was just it. Was a big political show oh I have one clip here this is from c-span and this is Elizabeth Warren talking to the CEO of Wells Fargo this is about personal responsibility Wells Fargo cheated millions of people for years the Federal Reserve should remove all of the current board members who serve during the fake accounts scam and mr. Sloan. You say you've been making changes at Wells Fargo for 30 years but you enabled this fake account scam you got rich off it and then you tried to cover it up at best you were incompetent at worst you were complicit in either. Way you should be fired either way he should be fired so telling the CEO of L's Fargo he should be fired maybe you should honestly I don't really know I watched some of that whole event and. It was pretty much a big political show you had all the the Democrats which were. Pretty much in a competition to see how much they could go against all the CEOs to. See how much they could fluster them a lot of them were like running for president and I think a lot of. Its to get their sound byte in and then you had. The Republicans equally just using as an opportunity to to tell everybody. How great the economy is and how they fixed everything from o.9 and so on and so forth a lot of politics there but I don't think it was a. Good look for the banks and I don't think it helped out this entire sector for the past. Week for overall this is one of the worst performing sectors I've had it has been negative for all a long time it just barely became positive and it might swing back negative I'll go through each holding real quick and. Give you an idea of where I stand on each of them the. First ones Main Street capital this makes up almost a quarter of this entire pie here and that is a this. Is a good one for just. For dividend income so if I actually look at it let's go. To the charts here I go to the scoreboard here they have a six over six percent starting yield right now they pay monthly and they have a really consistent history that go to their history click on on all on this look at this ever since about oh nine they have been going up just gradually. Increasing as well as being completely consistent and that's what I'm looking for I'm not going to see a ton of capital appreciation with but I look at the consistent income and I'm fine holding him for that ya see they have like a 4.3. Percent four-point-five given growth pretty good beating inflation certainly and I think it will compound over time now they do a lot of a variety of different investments in the long term equity and debt so that's their business strategies they're just. An investment firm and they share the profits with you through dividends the next one is JP Morgan which is the biggest bank in the u.s. right now I believe and I. Think most people are familiar with them let's go to the charts. Here they have a two point eight two percent dividend yield that paid quarterly if I go to dividend history and get a better idea of this you're gonna see this a lot in the US banking sector where things seem to be going good until oh nine when things fell apart after the recession they have. Built this back up aggressively I'm holding them if they do cut their dividends again I'll. Sell them but right now they've been very steady next one after that would be Bank of America this is a Warren Buffett holding I think he got a pretty good deal that you get one year worth as much as him he was able. To buy some shares not on the open market but if we look at it their dividends is 2% right now pretty low if I actually go to the dividend history here this shows a decent picture they're just starting to pick up steam. On theirs I look at the dividend growth here thirty one percent thirty nine even though. They haven't been paying dividends for all that long like if I look at. This it's been flat for a long time I'm pretty excited about them. Just because of the rate of growth. They've been growing there's like crazy so they're starting to pick up steam a lot and I think it might be a good one right now. To pick up. Before it goes up like crazy I'm fine holding them again all of these are going to be hit the american banking sector got destroyed after o nine it's kind of a reset right here and we're assuming that we're gonna avoid the exact same problem going over i certainly i bought two homes after o nine and. I certainly felt like I was heavily vetted before being able to purchase a home if we. Have a problem like that I don't think it will be with the housing market we I mean the efforts that I had to go through to buy a home they find out they make sure that you're employed they. Make sure that you don't have any other existing loans like through you pretty in-depth let's take a look at one of the foreign banks we have toronto-dominion bank I really like the Canadian banking sector in fact I think it's one of the only foreign holdings that I have so if I look at it the starting yields three. Point seven percent so much higher starting yield but then I look at the dividend history here and they have a super long and continuous dividend history not only did they have a great starting kiss or starting yield but they have a great dividend. History as well now you notice that this isn't like most American companies pay it goes up and down and I noticed it's a little bit more jagged when they pay it this is one. Where if one payment is lower than the previous one I wouldn't sell them it would have to be if they're trending back downwards but I I can see that they're clearly. Trending upwards right now if I go to the different growth over time look at this same thing steady dividend growth high starting yield I think really solid companies to invest in and tiró price this is one that was. Down like crazy and recently came back up they're an investment firm as. Well they've been. Around for a very long time this is a company that Peter Lynch just raved about in his book one up on Wall Street he loves T rowe price if I go to them their charts here two point eight seven starting yield let's take a. Look at their dividend growth I think it's pretty darn solid yep you can see since 2000 it has been continuously going up and. That's exactly what I'm looking for even though they're there. You can see the chart underneath here so just recently they dropped a. Lot I actually bought them unlike the high right here but they've been trending back upwards I'm almost even with them again really what I'm looking for is this trend this these are the companies I want to. Keep not the ones that don't keep this going moving on from that let's go to the Royal Bank of Canada again these Canadian Pink's I think are really solid these are I believe the two biggest Canadian banks so I just. Kind of split up each of them and went with each of them they're these three holdings are all at 8% if I go to the Royal Bank here 3.6. Percent starting yield again a great starting your yield low payout ratio. If I go to the dividend history here a nice solid trend upwards the Canadian banks are a little bit different they again it's just a way that they do dividends in different countries I think this is more common Canada but you see that it's the. Overall trend that's going upwards and that's good enough for me next is Wells Fargo this is one that I have as a lower percentage holding and the reason why I mean you can see they've just had scandal after scandal problem after problem I know it's. A Warren Buffett holding I just don't feel comfortable putting a ton of money into it right now you saw the video with Elizabeth Warren saying the CEO should be fired like that's not good when Congress I'm gonna saying that the. CEO of a huge corporation B should be fired I don't know if it's the best one to buy into right now I can look at the charts of it let's go to seeking golf a hair if. I go to the dividend scoreboard they do have a higher starting yield than most of them so they have a three point seven eight their payout ratios really low if I go to dividend history here you can see that they got demolished Cano nine like all the other traditional US. Banks they reset and ever since then they have been steadily going upwards I'm fine holding them for now I do have slight concerns about traditional banking that have tons of brick-and-mortar outlets for people to go to I can I see a trend at. Least in Millennials and younger people of using more online banks offer those super high yield savings. Accounts but I don't think that that's a ton of Wells Fargo's business and then the last one is a United Health Group let's take a look at that they have a one point six two percent starting yield so I believe that's the lowest out of inium. This group that's why it's the. Lowest percentage for me if I go to dividend growth here they have a solid dividend growth though and if you look at the history I believe they have a solid history as well the payout history doesn't get more solid than that even though they have a really low starting yield and the fact that they've dropped in capital a. Lot since I purchased them I purchased them right on a high and they've dropped down quite. A bit I'm still gonna hold them because I think this this rate of growth this dividend growth of having twenty percent since last year is really good so I'm actually happy to have them in the portfolio that's the financial sector right now I think these are all very solid dividend growth companies I tried to rule out ones that didn't. Have a good track record this sector was a little bit harder because onine put a kink in things that really pretty much cut out every American Bank if. You're going to go past ten years and look at their different history past ten years you couldn't invest in any of because. Almost all of them cut their dividends but I think this is well diversified I think that they offer a variety of different financial products and. So even if some of them fail you're still going to have some of them succeed and I try to diversify a little outside of the US as well but that's pretty much it I didn't wanna. Spend too too long on that I hope that was helpful and gives you some ideas to. Go with you guys can also comment and leave some of your favorite financial holdings that you do that I am leaving out my portfolio and. I might take a look at them and put them on my watch list so. Moving on from that I wanted to go through and go through the product AMA that the m1 finance team did this is m1 finance team and they went through and answer some of reddit's questions I have one of. The questions here that got answered as well as some other ones that I think are. Important and the reason I want to talk about this is because the broker that I'm using is m1 finance and I think it's a great broker specifically for people that are doing vivid investing the reason why is because they offer fractional shares and. So you don't have to wait till you get so much money to buy one share of a company I can go into my activity log hair dividends this $37 I didn't have. To buy one share of one company or wait till I have enough money to buy one I just bought fractional shares of four different companies with it and the system that they have that does this. Makes it so you can reinvest your earnings paid out much quicker than traditional brokers or even newer ones like Robin Hood you can't reinvest into fractional shares with Robin Hood that makes it so that I can sit with almost no cash on my account. Because it's constantly being reinvested I think that's a huge advantage for people doing dividend growth investing or any kind of David. Investing if you're gonna use m1 finance or you are gonna sign up for it I have a link on each one of my I have two links on each one of my videos here the invest using my PI if you click on that one it. Brings you to my portfolio as far as the actual layout of it and then you can hit like invest in this or saved in my account whatever it may be and doing that gives me a referral bonus for referring you and. Then it gives you some money when you sign up as well the same thing if you don't want to if you want to use m1 finest but you don't want to use my PI specifically just hit the m1 referral link and then you. And I get some money you get a help out the channel for free that way do that if you're gonna use them on Finance but let's go into the actual product DMA. Here okay one of the things that I highlighted it on my comments was. Notifications and dividend transparency on notifications I. Just think it would be a cool feature to have on your phone anything that happens in this recent activities right here I think that you should get a notification for and I think would be cool if you earned a. Dividend right here to get. A notification for that as well those are all things I recommend it to them they pretty much said that they're just working. On other things right now but they fully plan on doing that the other. Thing was the dividend transparency and in my question I'll go ahead and link by the way I'll link this whole AMA into the description so you can go through it. If you want but the dividend transparency has been kind of an ongoing issue with not being able to see who pays dividends if you go through here sometimes this earn dividend umber will go up like it will go from 750 to 755 but then you're not paid anything in activities because that's when. You earned it the issue with them on finances is you can't see who you earned it from or when it will be paid you have no information until it ends up in this activity screen based off of that I said that they should make it so it's more transparent where you get more information on who paid that. Dividend and when it's going to be paid now somebody else shared the same concern. They said the earn dividends I would like to see the list of companies are paying and how much I shouldn't have to wait and tell the money is in my account to know which companies are paying I think he's exactly right we shouldn't have to wait. Till it shows up in the activity log to see who paid that dividend because we earned it like sometimes up to four or five weeks ago they said yes enhance dividend features are on the roadmap we're starting with improvements to pay dividend reporting and investing activity so they're gonna be doing additions to that activity screen and we will. Be doing more with the earn dividends and notifications after that I'm really happy to hear that's on the roadmap of things that are gonna be working on the actually this first feature of the more information on. This screen here the activity screen they say that they're gonna be doing that within the next two months they're gonna be releasing that we'll have. That to look forward as well other good comments on it there's one with the concern of how to move slices from one pie to another it's actually kind of annoying to do currently if you have a slice and you accidentally put like let's say you accidentally put Apple in real estate you have your Apple. Holding in real estate and clearly it doesn't belong in real estate but you want to move it without selling it to do that you kind of have to. Do this longer process of going in doing an individual sell order on it and then adding Apple to a different pie and then doing an individual buy order on it for the same amount and that's how you move a holding. From one pie to another without selling it that's kind of a fun way to do it somebody brought that up and said that they wish there's an easier way to do that m1 Jake so one of the employees there said we are aware that the process. Of transferring slices between pies can be annoying and. Do currently have plans to improve it they're gonna be doing that and they say they're gonna be doing that after the m1 finance spend product comes out which. Is there checking banking product but more interesting than actually the AMA was another thread that just came up just a couple days ago and this is somebody that had a concern about m1 finance as a business with the amount of capital that they've raised but I'm on finances a start-up broker that's only available in the. U.s. start-up meaning they're just a newer company they've. Only been around for a couple. Years when somebody said well I'm I'm thinking about moving a large sum of money hundreds of thousands of dollars to m1 finance but he looked at the company he wants to know who's handling his money which is completely fine he's doing his due diligence in research and he found that they only have 20 million dollars in funding opposed. To a lot of other fine tech startup brokers like m1 that have hundreds of millions of dollars in funding so you look at Robin Hood over half a billion dollars of funding betterment quarter billion wealthfront 200 million fundrise 55 million acorns even smaller ones like. Acorns 207 million yields 378 million but you. Look at m1 finance 20 million and you know compared to all these that's peanuts the interesting thing about. It was Brian Barnes who was the CEO he's like I think he's part owner of m1 finance he's a founder of it he came in and. Gave this big long detailed response to it to try to go through some of the concerns of them not having as much funding and he pretty much said that they don't need that much funding they're not spending a whole lot of money on marketing right now like a lot of these companies they haven't spent their money to. Develop their product rather they spent it to blast you with constant advertisements for the product to gain. Market share and he highlighted this in one paragraph that I'll read he says when you look at a lot of our competitors they've spent a. Fortune for short term growth while not doing much to expand their offering the robos launched almost ten years ago and he's not going to go out and call his competitors out explicitly but I think he's referring to like wealthfront acorns fund rise those type of. Ones he says the robos launched almost 10 years ago as an easy way to buy a basket of six to ten ETFs that's exactly what wealthfront is ten years and nearly a quarter billion dollars later by each firm and there's still an easy way to buy a basket of six to ten ATS they've. Spent money on marketing telling how great they are rather than enhancing their offering his focus as the owner of m1 finance is. To enhance the offering and he says his strategy is. To make it so that us the users are pretty much the salesman for it I think that strategy is working the strategy of focusing on the product and letting it market itself I think is a better strategy than just focusing on on putting. A ton of. Money into marketing and. Trying to gain market share as fast as possible you know I'm I feel like I'm somewhat advertising I'm on Finance just by using it on these YouTube videos and I'm not being paid to do that I get some money when people sign up through the referral links but I could I think there's other applications other brokers that I can. Do the same and get referral links the reason that I use m1 finance is I think that they have the best the best value right now it's free and I think it's good for dividend growth investors wanted to touch on the AMA I'll throw those two different links in the description of this video as well so you can look. At those the other thing I want to touch on is an article I came across from Wall Street Journal and it's venimos attempt to become profitable the venmo which is owned by PayPal. Has gained and market share over and over again but they have not been able to. Be profitable at all even breakeven and their latest offering is going to be credit cards my first thought was that they're entering a very crowded space this is kind of every company's doing right. Now and the actual. Wall Street Journal article had a paragraph that highlighted this says venmo is entering a crowded market as more technology companies developed credit cards talks about Apple it talks. About American Express offering Amazon cards which Amazon is also already offered you Chase Bank right now and there's this a lot of big tech companies getting into the credit card game now this brought up a bigger question. Me because venmo isn't. Even supposed to be profitable at least another few quarters. When you invest in unprofitable companies I think there's an inherent risk that people don't fully understand the companies that I try to. Hold in my portfolio are highly profitable companies the company's so profitable they. Don't even know what to do with all of their profits they make that much money they end up doing they say. We have too much we're gonna return a lot of it to our shareholders that's how profitable we are companies like venmo that are still trying to turn a profit I think have more risk. Than what most people give them credit for you might make the assumption that just because. A company is able to gain market share they can just flip a switch and become profitable as soon as they want but a lot of companies are having a tough time flipping that switch even though they have a large market share now one example of this that went completely wrong was vine and I have to go to the. Wikipedia article of this because vine no longer exists as a company that was acquired by Twitter and it became a social phenomenon it had tons of users at one point grew to be a huge viral hit and what vine was is you could upload six-second videos and. Broadcast yourself that way and people would make a lot of goofy videos. There's a lot of people that move from vine to youtube. They got kind of their career started on vine but it just ended up tanking and eventually everybody started leaving it the user started leaving and. Twitter actually just said okay we're just ending the whole project vines just done the whole company's done even though it had 200 million users at one point I'll read I'll read. One paragraph from the Wikipedia page to highlight how this can happen said marketers leaving the platform were also an enormous part of the decision by Twitter to discontinue vine many monetary sources begin to move to longer short-term video platforms and with them followed more many popular. Vine creators since the start of 2016 vines top 9725 accounts had ceased to upload more vines and had moved to other platforms such as YouTube Instagram and snapchat just because they were super popular at one point doesn't mean that they could flip a switch and become. Become profitable popularity doesn't always quite the profitable there's other examples of this as well but I think this is a pretty big one I'm not insinuating at all that this is what's gonna happen to venmo I think venmo has a lot more longer-lasting of a product but just be wary that if you're investing in. A company I like to look for cash flow I like to look for companies I already know how to generate a profit not ones that just have a lot of users but. They still haven't. Managed how to generate a profit because sometimes when it. Comes to generating the profit that scares away their users something I think worth noting there the last thing I'll do is answer some of your questions already so I had a lot of good questions. On the previous video I'm gonna go ahead and go through a few of them let me throw the first one up on the screen here this is from someone named brandy he comments and says can you explain why you always choose. To sell your stocks when they cut / decrease their dividends that is true so when a company I have chooses to cut. Or slash their dividend I will sell that company right away unless there is some super special circumstance that would convince me otherwise that's what I plan on doing part of the reason why is my goal for this portfolio is to create a stream and generate a. Stream of ever growing income I have graphs like this that charted where I want to see money coming in more and more month-over-month year-over-year that's. The goal of this portfolio if companies are cutting their dividend or their income stream to me they're not helping me achieve that goal so that's part of the reason why I need companies that are gonna help me achieve my goal of having a long sustainable income now there's other reasons besides that I think that it's actually just a better. Strategy to do so I can give you a for instance let's take a. Look at GE in November of 2017 General Electric which was historically a great dividend paying stock this will probably happen to a couple of my holdings where they go through something like this not all of them are gonna be successful GE had trout troubles they cut their dividend they announced that they're. Gonna cut it from twenty four cents here to twelve cents so they slashed it by fifty percent and people had a choice at that point whether to hold it or whether to sell it I would sell it and let's take a look at the charts. Here if you're looking at this if we go to the five years here let's go to November 2017 if you sold at November set 2017 the very next day you would save yourself 48 um 48 and percent losses is what you would have saved if you sold right then now you may say well they were. Dropping before that but sure they still maintain their dividend at that point that is that when they cut their dividend that is a clear cue that they have long term issues that they cannot sustain their dividend and I think it's just a smarter. A smarter choice to sell at that. Point even though I would. Have taken 40 percent losses if I sold the company when they cut and slash their dividend I would have saved from having another forty eight percent losses. And I guarantee you the people that chose to sell right here at $20 a share feel a lot better than what the $9 a share is. Now the people that chose to hold on to it I'm not saying that it's always going to be the best decision I. Rather sell that company not look back I have tons of holdings of highly profitable companies that have so much cash flow that they don't even know what to do with it I rather take whatever money is left from that holding that cut their dividend and throw it back into one of these companies moving on to the next. Question I have one from someone named gray Vickery he says great video great vid I've been keeping Disney on my watch list for a while I was pretty bummed this past week to see the stock shot up 13% I should have pulled the trigger earlier do you think. I should wait to buy in at this point considering the stock is at an all-time high that's a tough question I'm not I'm not the one to go to when trying to time different holdings that's not really my game I'm not I'm. Not here to trade in and out of companies for a quick earnings quick turnaround I think Disney has a great long-term. Future if you're going to hold. That stock for. The next ten to twenty years I think buying now is completely fine I would feel fine putting ten thousand dollars into Disney I think that they have a bright future ahead of them I think that their streaming service will do really well and at the very least even if they just stay where they. Are I think that they have pretty good value right now with their parks with their merchandise with their production company so they have a lot to fall back on I think that Disney has a pretty good margin of safety all things considered and now they have a huge growth path to heaven ahead of. Them as well I think they're fine to buy in right now even though they've gone up 13% if you have a long enough time horizon so the next question is someone John he says you say capital growth does. Not matter to you but it should dividends don't matter if your capital is down 25 or 50 percent also dividends can be reduced or even canceled at a moment's notice by the company so they are not guaranteed those are all true and in my last video I had the line where I said that I don't. Care about the capital appreciation now that might come off is a little bit more flippant than it should like I just don't care about that money of course I'm in this portfolio to earn money whether that comes from capital. Appreciation or dividends is a whole other subject but the goal of this portfolio is to earn money now the reason that I say I don't care about capital appreciation I would say if I was going to give an analogy it would be like like saying I don't care about weight loss what. I'm gonna do. Is focus on eating healthy and working out with the assumption the strong assumption that if I eat healthy and I workout the weight loss and the physique is gonna follow it and that's the same thing I'm doing here I don't care. About capital appreciation in the sense that it's not what I'm focusing on do I think capital appreciation will follow with this strategy if I have a a conservative ever growing stream. Of income from high-quality companies that have high cash flow I do think that they will appreciate in capital I'm making that assumption but it's not dictating the whims of my portfolio it's not what I base my buys and sells around like this user that asked you know should he buy in at 13% I don't. Make too many decisions based off of that I like to buy things at lower prices but my biggest thing is is looking for companies with long term growth long term cash flow. Growth and focusing on that with the assumption that capital appreciation will certainly follow if that strategy is followed so I appreciate you John watching my videos and commenting I hope that that makes sense that I'm not too far off base there where it's not. The capital appreciation is not dictating the goals in my portfolio it's not dictating my strategy but I think if I implement this strategy I certainly hope and I believe it's something that will certainly follow with it so if that makes sense that's kind of what I was that's. What I was saying there when I said that I don't care about capital appreciation okay so let's move on to the next comment this is from Jer haha he says your videos are awesome yeah I like the enthusiasm there I'm glad when when people can. Think that finance investing videos are awesome that's a cool thing I think now he says that he's going through and watching the videos from the beginning if you do that you can. Use that playlist at the bottom of the homepage if you want to make that easy but other than that he says. If you don't mind me asking why did you pick those specific bond ETFs I am trying to find tax-free bonds to diversify my portfolio and create in trying to create income without increasing the current taxes if I go and actually look at my bond ETFs here these are what I have and it's a mixture of one two. Three year three to seven and seven to 10-year Treasuries and then half of it is investment grade corporate bonds now this was just me trying to get some kind of stable fixed income that wouldn't. Follow the rest of my portfolio. I wanted this to just be something. That is an anchor that makes it so that my portfolio overall is less volatile but I still get that monthly income reinvested over and over and compounding the reason that I chose these ones is. I just wanted it half of it to be super secure so ten percent of my portfolio because the overall bonds. Is twenty percent and then half of this is Treasury bonds so I want ten percent of my portfolio to be. Ultra secure which is Treasury bonds those are about as secure as it gets they yield like slightly more than a high-yield savings account but that's money I want to have on the sidelines in case I have some kind of emergency and I have to withdraw money from it I can take it out of those. Treasuries it's not going to go down too much even in a recession or that type of thing I could also use if the rest of my portfolio drops because of some big drop or dip I could sell these Treasuries and. Buy equities with them so I have that option as well but I like. Having that that 10 percent an ultraconservative Treasuries and I just picked the mixture just 30 percent each of these and that the half of it. I just have one-third each different maturities and then half of it I have investment grade corporate bonds now the reason that I chose investment grade rather than a lower grade bond like a junk bond even though if I look at. These they don't have the highest yield so if I go to these it has a 3.5 percent yield I could. Go get junk bonds or lower grade bonds and have those yield like upwards of five percent or more the issue I is that when I looked at the graphs and looked at the history the investment grade corporate bonds did not. Exactly trade in line with the rest of the market junk bonds traded in line with the rest of the market so when all the rest of my portfolio dipped so would junk bonds and that's not. The goal of bonds for me. Bonds are to balance out and to be an anchor to against the rest. Of the higher risk equities and I feel like investment grade corporate bonds do that if I look at lqd and I go to the graph here we can look at how it reacted in 2009 so if I go leading up to. It it dropped about 23 percent even the one. That's a much higher yield at the investment grade corporate bonds it still only dropped about half as much as equities did so equities dropped about 50 percent lqd which is investment grade corporate bond etf that dropped 23% and that's kind of what I want is I want something to say that still has a high. Yield pays me good income but it's not quite as risky as the rest of my portfolio I hope that makes sense you also asked if about tax-free bonds I haven't looked into a lot of that so you might want to ask some other users in the comments that might know more. About it I'm more about municipal bonds in me I haven't done a whole lot of research on bonds to be quite. Honest I choose the ones that I think are pretty standard a standard bond mix to have in a portfolio but I haven't done in-depth research into all the different kind of. Debts that you can you can purchase I'm gonna leave it there that's. All the questions for today I hope you guys have. A good Easter Sunday and have a good week I'll be coming up I have a lot. Of videos lined up it's been really fun to do this so I hope you guys aren't enjoying them if you haven't already if you're one of the 60% of the viewers I get that aren't subscribed make sure to. Hit the subscribe button to see fewer future videos and I'll talk to you guys soon I'll.

 


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