AVOID these Stocks | Watch *THIS*

why does it feel like so many stocks are

red so many of the stocks in our

community are red yet markets continue

to go to all time highs

what's happening why is this happening

and what can this teach us about

investing well that's what we're going

to talk about in this video keep in mind

this video is brought to you by

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here's the thing why

here we got to break some of this down

and this is really good background info

to consider ask yourself this what do

these companies have in common tdoc

palleteer square pinterest peloton bunch

of different specs

and corsair what do all those companies

have in common and then ask yourself

this what do these companies have in

common enface etsy adobe autodesk nvidia

microsoft apple and qualcomm

and google what do those companies have

in common with each other and that the

other companies don't have in common

with each other think about that for a

moment if you're a regular investor you

should already have a pretty good hint

as to what the answer is

but just in case you don't know i'll

tell you in just a second

but first we have to consider this so

far this year the dow jones industrial

average has 24 out of 30 of its

companies in the positive territory

that's 80 percent of dow companies are

positive

in the s p 500 we have only 90 companies

with negative returns that means 81 of

companies in the s p 500

are positive

for 2021. in fact we're expecting

returns of around 25.8 percent for the

year in the s p 500 unless we get some

kind of crazy december sell-off that's

incredible in fact i have a basket that

i put together at met kevin.com basket

it's a full basket

and it basically gives you an allocation

in the s p the dao the russell

uh and the nasdaq and that's actually

underperforming the s p 500 by about one

percent pretty dang close it's still up

like 24

certainly beats what we've got going on

at arc arc k is down

14.25 percent for the year arc f the

fintech fund is down 3.23 arcg the

genomics fund is down 20 i'm sorry 31.6

percent for the year arc x the space

fund in case you don't know about it you

can type into youtube meet kevin arc x

space and you'll see a full breakdown of

arc x that's down 3.99 for the year arc

q that's the

autonomous and robotics etf that one's

actually up eight percent

and overall you've got a lot of

institutions and hedge funds totally

underperforming the s p 500

so what's the big difference between

those stocks that i just mentioned

and

well the two different baskets of stocks

that i mentioned what's the difference

between them and what can we learn about

investing when we consider comparing

these two i'm going to answer that right

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folks tdock palantir square pinterest

peloton spax and companies like corsair

are not in the s p 500

companies like enface etsy adobe

autodesk nvidia microsoft apple google

qualcomm are in the s p 500 now i don't

want to sound overly basic here but take

a look at this folks this is a list of

inflows and outflows into the top or out

of the top etfs of 2021.

you can see over here redemptions or

outflows you have you've got almost 10

billion dollars coming out of the spyder

gold trust you've got money coming out

of corporate bond funds money coming out

of here we've got other corporate bond

funds treasury bond funds uh the russell

1000 growth fund oil funds consumer

staples funds these are all losing money

now let's go over here you got vo with

48 billion in inflows so far that is

matching the s p 500 by the way the vo

just tracks the s p 500 or tries to

vti

takes that s p 500 and adds another like

3 500 companies to it they have

virtually the same return there's about

a two percent difference in their return

and that's because vti has like 3 500

more companies but it does encompass the

s p 500 companies so 38 billion dollars

going into vti

is basically still like putting your

money into the s p 500

uh then you've got the i shares s p 500

then you got bond and value then you

have qqq which if you look at the top 10

holdings for the qqq they're almost

freaking identical to guess what the s p

500 holdings apple google microsoft

adobe you see where we're going this

then you've got a short-term bond fund

here some other funds developing markets

fund and again the s p 500

when we add up how many of these funds

right here or all of these net flows

which works out to about 206 billion

dollars when we add all of that up and

basically divide by the number that are

going into s p related stocks

you're seeing 66 out of every 100 going

into these top funds are basically going

into s p 500 style stocks

so

what is in the s p 500

well it should be no freaking surprise

look at this folks microsoft with a six

percent weight microsoft has been

killing it

and i mean like i i i'm not a microsoft

bull by any means i'm not a microsoft

bear either like i'm totally neutral on

microsoft but microsoft's performance

has been unbelievable this year

and it's the top stock in the s p 500

with a 6.35 waiting followed by apple at

6.31 amazon at 3.9 big gap tesla 2.25

google at 2.2 ish nvidia at 2 facebook

2.03 then you got like jp morgan home

depot you know visas in here

netflix has absolutely been crushing it

there in here uh no not all companies in

here have done

excellently i mean look at like visa and

paypal right we've had a little bit of a

sell down in fintechs but folks

we got to make some conclusions here

so the first thing that i like to do

when i look at something like this and

this was eye-opening to me when i was

doing this sort of research here is i

like to think of myself as where do i

like investing well i like investing in

companies that i think have a lot of

value well i've always thought that pal

look and and want to be crystal clear

here i like palantir i think palantir is

highly misunderstood i don't profess to

be a palanteer expert i think volunteer

is a great company so i think the same

about teledog but i don't invest in them

i also don't invest in companies like

corsair even though i think you know

they're going to grow a little bit

slower they've got good value they're

not selling for that expense of a price

but why potentially do they not have

something that the other companies do

which first and foremost is performance

well potentially it's because they don't

have wind at their backs

let me explain the concept of investing

in something that has wind at your back

using options as an example so take a

look at this jump on over here to the

app pad the good old ipad

all right

when you s when you buy leaps

long equity option contracts

when you buy leaps there are two things

that hurt you

number one

is volatility

crush

and the second thing that hurts you is

theta decay

if you do not know what these two things

are you should not be investing in

long call

options because these things will bury

you usually you just get people who buy

calls and they're like well i think the

stock's going to be worth more in the

future but you put no value on your vol

crush or your theta decay you're

probably going to get screwed unless

you're buying stuff deep in the money

and if you don't know what any of the

money is you shouldn't even be worried

about options at frick at all but anyway

these two things

let's understand what's happening in

today's environment well first things

first we have declining volatility all

you have to do is look at the vix to

fact check me on this so you go to

weeble or whatever it is you type in

vicks then you go out to the day chart

then you zoom out

honestly

you could probably zoom out even a

little bit more i go with the day chart

there we go all right go with the day

chart

this is your 2020 crash kind of

volatility but what have you had since

then folks let's just draw the trend

okay very simple draw a little trend

line here what's the trend been has it

been up or has it been down it's obvious

volatility has been declining that is

not a surprise when volatility goes down

your options premium goes down

and every day that goes by as volatility

goes down your price of the value of

your options goes down and you get theta

to ke eat now away basically because

you're paying to rent that contract

basically every single day so your value

is going down so in other words when

you're buying leaps in this market you

actually have what i call

two

headwinds you have two things going

against you pushing against you

now you could do the opposite of this

and then you would have two tailwinds

two tailwinds would be

uh well if you sell options because if

you sell options you win when volatility

goes down so vol down

helps when you sell options and theta

decay goes to the owners of options who

sold the options

so if you sell calls and sell puts you

have two tailwinds if you're buying long

calls you have two headwinds so what

does that have to do with the s p 500

and certainly is not kimble musk's

documents right there

well what it is

very simple

the s p

500 and people

passively investing pi passively

invested are your biggest

tailwinds

that's a good thing that pushes you

so you have to ask yourself would you

rather invest in stocks that look really

good on paper but don't have the

tailwind of the s p 500 or would you

rather pick really good stocks out of

the s p 500

and have the tailwinds and this is by

the way just the kind of psychology that

we talk about in the stocks and

psychology money course remember you

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great deal and the pricing does go up

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that prior sale on black friday black

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but hey you've got another bite at the

apple here and the pricing will be going

up after cyber monday uh you know the

cyber monday sales are over but anyway

uh you've got some serious tailwinds

when you're investing in s p 500 related

stocks and i believe that's why

companies like shift technology teledoc

palantir and some of the others are

lagging behind now don't get me wrong it

doesn't mean if you invest in every s p

500 stock it's going to do perfectly i

mean i guess if you invest in the entire

index it's done great it's been 81

positive but look disney and paypal have

been getting smashed and they're in the

s p 500 right so it's not a guarantee

but i would say it's easier for paypal

or disney to get out of this trap that

they're in this hole that they're in

because of all this money going into the

s p

so i actually think that's bullish i

also think it's bullish for companies

like and face etsy adobe autodesk nvidia

tesla microsoft apple and so on and so

forth they're all in the s p 500. now i

do think that they're at extended

valuations right now but i do think

there's an opportunity to buy these

by selling puts

just on a weekly basis sell put sell put

sell put sub puts and if you get

assigned big deal then then you finally

own the stock and if you don't you're

yield farming

uh now don't get me wrong i do invest in

companies that are outside of the s p

500 like i've got a huge position in

matterport or a firm these are excellent

companies matterport killed it today it

was up 20 percent this is another stock

we've talked a lot about in the course

stocks and psychology of money group but

anyway

consider this when you're investing look

for stocks with wind at their back you

don't want headwinds headwinds hurt

hopefully this perspective was very

helpful and insightful to you i wish you

the best in investing and folks check

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go to privateinternetaccess.com

me kevin thanks so much goodbye