Stock Investors, Prepare For A Rough Month.

Good morning everybody. Welcome back to another Wednesday here in the stock market. Look, I wanted to jump on and make a video for you all essentially breaking down what my full game plan is for the month of September in my public portfolio. Because as many of you know, the month of September is historically the worst month to be in the stock market. And because of this, a lot of people have started to get real nervous and anxious heading into this month, not quite sure what to do, especially considering the fact that we're already off to a bit of a shaky start the last few days. A lot of people are looking around and they're going, you know, do we buy? Do we sell? Do we hold? Kind of what's the plan for a month like this, especially if they've only been in the market for a year or two. And so again, because of this, what I wanted to do in today's video is just break down that full game plan for you all. And so the way in which we're going to go about today's video is I'm first and foremost going to walk you through exactly why we all say that September is the worst month based on historical averages. Then I'm going to walk you through what my exact game plan is as a result of this data. And then we'll finish up by actually jumping into the portfolio and I'll show you what that practically looks like in these live positions. And my goal is that you leave today's video not with the ability to just copy my game plan, but with some sort of idea or perspective as to what someone who's been in the market for 8 years, who's been through September eight times does in order to prepare for it. Okay, so we have a good bit to get into today. But look, I did want to let you all know before we do jump into these historical averages that on September 12th, I am going to be hosting a technical analysis boot camp. It is completely for free. You don't have to pay a dime to join. And what we're going to do is for two to three hours on a Saturday, I'm going to teach you all of the basics to technical analysis. What it is, candles and structure support resistance patterns, live chart walkthroughs, beginner mistakes. We're going to do a Q&A at the end. And my goal is that by the end of this technical analysis boot camp, all of you who watch my channel have a good understanding of the basics and fundamentals of chart reading. so that when I'm making my videos and we're looking at charts and we're looking at indicators, you have a very clear idea, a very clear uh understanding of exactly what it is that I'm talking about and how it can be applied to your own portfolio. So, if that's something that sounds interesting to you, again, remember it is completely free to attend. All you need to do is come to the website. I'm going to have it as the first link in the description. Click save my seat, enter in your full name and your email, and that's going to get you your seat. You don't have to do anything else. It is as simple as that. But I will let you know there will not be any replays. This is not going to be recorded. So you need to be there live. This is something you need to watch live. Okay? So the link to that down below. Make sure to check that out if that's interesting to you. But with that in mind, again, let's go ahead and let's jump straight on in and let's talk about some of these different historical averages. So on this chart, this chart comes from yard.com. Shout out to them. Um it has three very important metrics, three important charts that I think all paint the picture very clearly. Okay, so the first chart up here essentially breaks down how many times since 1928 to now a certain month has seen positive versus negative returns. And if we go look at September specifically, what you can see is that since 1928, September has put in 44 green months and 53 red months. If we compare that to everything else, that means that September by a far has had the most amount of red months by about 10% over the next best at 48 for February and by a far the least amount of green months at only 44. Now, to build on top of that though, not only does September historically have the most amount of red months, but oftent times when September is a red month, it performs the worst. What the second chart right here shows you is the average percent return on a green month versus a red month. Um, throughout these green months and red months that it's shown. So over the course of these 44 green months that September has had, it's put in on average about 3.18% returns. Through these 53 red months that September has had, it has put in a return of about 4.7% negative or negative 4.7%. Now, if we compare that to every other month, that means that not only does September on average show the most amount of red months every year, but it also performs the worst when those red months come around. The only one that's really close is May, and that's at 4.68. But if you look at the amount of months that May spins in the red compared to green, it's not even close. And so September put very very cleanly and clearly, September historically will just put in a red month and it'll put in the worst month. So, if you have a stock portfolio, normally if you're going to have a bad month, it will usually be in September. And if we look at what that looks like and just averages over time, if you look at the green months and the red months combined, September puts in about a negative 1% return throughout the um throughout the month. Compared to every other month, that is a dramatically worse month. I mean, look at it compared to July. July is usually a really good month and December is a good month. January is a good month. September, on the other hand, not so good. Minus 1.08. And so again, because of that, a lot of the people who have been in this market for a while, we just prepare for these sorts of bad months. It's like you kind of just you kind of just know, look, maybe there's a chance September won't be a bad month. And if we do look at the last two years, it historically hasn't been, but you you can't get caught up in this idea that things are changing. This is just naturally how it goes. You're you're in your back to school, your back to school kind of time frame. People are coming back from trips. People are investing less. People are hedge funds are preparing for their Q4s. September is just usually not super great. Okay, so because of that, what I want to do for you all now is walk you through what my game plan is. Now, I did kind of walk you all through this on the live stream yesterday. So, sorry if this does sound a bit redundant, but I did want to just log this full thing as a video so we can always refer back to it easily. But, as I mentioned before, this is my plan and it's very simple. So, the first thing that I do in my game plan is I just assume it's going to be a red month. And I know that sounds dumb because I just walked you through why it probably is going to be a red month, but a lot of people will look at this in an optimistic view. They'll say, "Well, Tyler, at the end of the day, there have still been 44 green months, and those green months are still usually pretty decent. And if we look at the last few years, September has been a green month. So why, you know, why are we all being pessimistic?" And look, I understand that optimism is great. Glass half full. Great. I love that. But if you look at the historical data, September has a higher percentage chance of being a red month than a green month. So, I just assume it's going to be a red month. My approach is assume that the worst is going to happen. Hope the best is going to happen. Let's hope that September is a green month. Let's hope that the S&P 500 goes up in the month of September, but assume that it won't. I would rather that than you assume it's going to go up and it doesn't and you have no plan and you start panicking and freaking out. Okay? So, first and foremost, just assume it'll be a red month. Now, because I'm assuming it's going to be a red month, what I personally like to do first is try to make that red month easier on myself. And the way in which I do that is I just get rid of my low conviction holdings. If there's anything in my portfolio, if I have any positions open, if I have any trades open that I genuinely don't have faith in, I don't like them. I don't feel good about them. I've been wanting to get rid of them. It's been nagging at the back of my neck and I've just been wanting to get rid of it, but I haven't because I've been scared that it was going to go up. Well, if there was ever a month there where it won't go up, it's probably a September. And so, because of that, what I do is I go in and I just prune those low conviction holdings. I just get rid of them. Okay? Just get rid of them. And what I'll then do is I'll stuff that cash aside and prepare buy orders for my high conviction holdings. Now, I don't always accumulate on all of my high conviction holdings in the month of September, but what I'll generally do is pick one, two, or three of my best ones, and those will be the ones that I will prioritize finding buy orders for. Now, the way in which I prepare my buy orders is very simple. I just look at the charts. You guys know I like to do a lot of technical analysis when I'm looking for these sorts of entry plays based on how the market is performing. And so what I'll do is I'll go on something like maybe the S&P 500 and I'll just lay out where of course I believe personally that the best zones to purchase are. Where are the support levels? Where where could we potentially see the S&P 500 give a beautiful bounce towards the upside. Now, if we're going to do it really quickly, I can kind of walk you through what that looks like for me in my actual September game plan just to show you kind of um more practically and tangibly how that looks. So, what I would do for something like the S&P 500, as many of you know, in my actual portfolio, VO makes up the majority of my portfolio, currently making up about $426,000 of the total market value. So, what I'll do is I'll go look at something like the SPY. And I don't know why my candles aren't turning on here, but what I'll do is I'll go look at something like the SPY, and I'll go, okay, where do I think personally that um the SPY has the best chance, the S&P 500 has the best chance of getting some sort of bounce back up towards the upside? Those are the levels where I want to set in my buy orders. So what I'll do is I'll go in and say, okay, first and foremost, let's try to identify some structure. So cool, we have some structure sitting directly above below us. As we can see, there is a very clear buyer zone that is going to be sitting essentially right where we are right now. You had your resistance here, resistance here, resistance here. I believe that just like the seller stepped in here, the buyers are going to step in here and try to support the price anywhere between 760 and 754 bucks. So this is where I'm going to start doing my first batch of purchases. But I know that there is a world in which September does continue to just get worse from here and pulls back towards some of these lower levels. So I'm going to start looking for some um key support levels down here that I want to accumulate at as well. So the next thing that I would do is identify my bottom side golden zone. Okay, where's my bottom side golden zone at? Cool. It's right there. It sits roughly between um let's call it $748 and $740. So that's where I would do my next batch of purchases at. And then worst case scenario, we end up seeing the S&P 500 not only pulling through this structure right here and through this golden zone right here, but start extending lower. And if it does start extending lower, I personally believe that we're going to see the S&P 500 come down into this bottom side extension zone between $715 and $700 right down here. This is where I think that we could end up finding ourselves creating some sort of bottom for the month of September. Now, that would be a really, really bad month. I mean, that would be a minus 6 to - 8% month, but you know, it's it's always possible that you end up putting in the worst month um or, you know, one of the on the worst side of the spectrum of the months. And so, I do want to make sure that I at least in some capacity have buy orders set down there. And then what I would say is, okay, well, the lower that we go, the more likely it becomes that September's price does actually go in and bounce off of these one of these levels and the S&P 500 bounces back up. So, what I would do is I would start accumulating in higher capacities the lower that we go. So, let's say I have a $100 that I want to invest in the S&P 500 throughout the month of September. What I may do is go in and put, let's call it 20 bucks in as um potentially the SPY comes down into this red zone. I might do about 30 bucks at the golden zone. And then I still have about $50 left. And I'll save that $50 just in case things get really bad, at which point I can go and accumulate in this downside extension zone, which I think that we would of course be able to see the price try to bounce off of. And so, I'm distributing that $100 out in higher clips the lower that the price goes. So that my and essentially my buy orders are getting bigger the lower it goes because it's becoming more and more likely that it does try to bounce towards the upside. Now I know that sounded a little bit more complicated than maybe some of you are used to and that might have sounded a little bit technically dynamic. That is a part of the reason why I am hosting the technical analysis boot camp by the way. So make sure to go sign up to that if um you know if you're interested but you don't have to do it that complicated if you don't want. Literally, one thing that you could do is instead of going in and setting in actual buy zones, you can just say, "You know what I'm going to do? I have $100. There's 30 days in the month of September. I'm going to invest $3 a day or well, I guess there's only what, like call it 22 24 days that the market's going to be open this month. I'm going to invest $5 a day every day that the market's open until the month of September ends." There's nothing wrong with that whatso whatsoever. You can just go in and just dollar cost average this bad boy. Or you can say, "Okay, where's one key zone of support? I'm just going to go all in at that zone of support." I wouldn't really recommend that. But the whole point isn't to try to complicate it. The whole point is just to get some sort of plan together. Where are you going to buy if the month of September does get bad? And look, yes, again, September might not be bad. In the last couple, you know, last 98 years, 44 months of the of the 98 months have been green, but more of them have been red. So although it might not be red, it's probably going to be red based on historical data. And so the best thing to do is even if they never we never see the price of the S&P 500 or these individual positions come down towards these lower levels, at least have a game plan set in place in case it does because historically it will. Okay? And then the very last thing that I do once I've set in my buy orders is I wait. I just let those buy orders come to me and I just prioritize learning new strategies, skills, and tools because in a month like this, it's never really fun, right? You're never really going to be super excited. I mean, if September is a green month, it's different, but normally when it's a red month, it's never really a good time. You never really enjoy it. And it gets very easy to like kind of lose your love for the market, lose your love for stocks in a time in which everything just continuously goes down. And so, because of that, what I like to do is just take a step away from looking at the charts, take a step away from looking at the news, let my buy orders come to me, and just learn new strategy, skills, and tools. Maybe there's this new thing I've been wanting to learn. I've been wanting to brush up personally on FVGs, fair value gaps for a while now. I learned a lot about them about three years ago and never really used them too much. So, I want to brush up on that personally. And so, what I'm going to do in the month of September is brush up on that. Or maybe there's a new platform that I've been wanting to learn recently. I'll go do something along those lines and I'll just wait out the month. Okay? And so, it's not this big crazy dynamic thing. No, it's literally just saying, "Okay, look, it's probably going to be a red month because historically it is. So, I'm going to get rid of my low conviction holdings now so I have high conviction going into the month. I'm going to set in my buy orders either using that cash that I got from those low conviction holdings or just cash that I added from my paychecks that are coming in. And once those buy orders are set, I'm going to wait for them to come to me. And I'm going to prioritize learning new strategy, skills, and tools. And I'm just going to wait out the month of September. And as things change, as we go up, as we go down, if I need to make some adjustments, I will. But usually the whole month of September looks just like this for me. And because I've done this, it's honestly made it very easy for me. in this public portfolio, for example, to go through the months of September. I remember the last September we had, I did this exact same thing. Now, it was a little bit easier because the month was just positive. But you get the point. These sorts of moments are when you kind of just pull off the gas a little bit. Look, this month may feel a little bit chaotic. It might feel a little bit worrying, like there's a lot going on. And sometimes the best thing to do is not too much. Set a simple four or fivestep game plan and just follow it to a tea and this month will go by much faster than you expect it to. Best case scenario, it's a green month. Worst case scenario, it's a red month, but you have a full game plan to take advantage of that red month and set yourself up for future success. Because remember, the next months from here are some of the best usually. Months like October, months like November, months like December, months like January. These next four months that follow September are historically some of the best in the market. And so all you want to do right now is just get to them. Just survive to them. If September's a bad month, it's fine. just get to the good months because once those roll around, well, things are usually a little bit more exciting. Okay, so that's what my game plan looks like. And so it's very simple. I've gone in I I don't have any low conviction positions that I was going to prune. The only one I thought about doing was Mastercard, but quite frankly, I don't really need to right now. Mastercard's done really well for me. As we can see, this Mastercard position, which I started up only about four months ago, is currently up about 15%, which is a $500 gain. So, I'm just going to leave it alone for now. I don't have any other smaller positions that I'm looking to prune in this position or in the hyperscaler trade that I'm doing right now. I'm very happy with what I'm seeing from Microsoft, Google, and Amazon, although they are maybe not performing super great over the last few weeks. And so, my game plan is very simple. I'm going to keep the positions that I have. I've gone in and set my buy orders for the S&P 500, which is what I'm prioritizing my accumulation on this month. And now, I'm just going to focus on learning some new skills. As I mentioned before, I'm learning about fair value gaps this month. Okay, so that's my game plan. That's how it works. If you are someone and maybe you're maybe you're going into step number four right now. You're assuming it's going to be a red month. You've pruned your low conviction holdings. You set in your buy orders and you're trying to learn a new strategy and skill set. Well, look, there you go. Boom. Technical analysis boot camp September 12th. That's perfectly timed for those of you who are looking to prioritize those new skills. So again, make sure to go sign up to that if you are interested in that down below. And yeah, let me know what you think. So let me know what one thing I really do want to know down in the comments is what's your plan for September on a month like this? What's your game plan going into it? And if you don't have a game plan, let us know down in the comments because I think it's important to recognize like, hey, I don't actually have a game plan and I should probably have a game plan. So, let's have some conversations down there. You guys know I like to respond to every single comment that you leave down below. So, feel free to drop a little comment down there. Don't forget to go get your free seat at the Technical Analysis Boot Camp. And I can't wait to see you all in the next one. Peace out everybody.