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Anonymous

20 Mar 2021

āˆ™

Stocks

What is your opinion on Youtuber Chicken Genius?

I have been following this Financial youtuber, Chicken genius. The man offers good advise on how to allocate wealth for growth investing but he seems like a deviant to me.

He mentioned recently that he js so sold on Tesla that he will allocate 95% of his portfolio in it. Also mentioned that he will dump money into Bitcoin next.

I feel that he will lose money eventually. I mean 95% stock allocation? Too much of a risk? He also advocate having 2-3 months emergency fund as a max.

Discussion (14)

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Entertaining videos and a YouTube channel primarily to fan boy about Elon Musk.

I don't envy him as he has placed himself where it is difficult to take back his words of which can lead to huge biasness.

He has fell in love with his stocks, which is a big investment no-no. Then again, it's a channel to fan boy about Elon Musk (read channel description)

2-3 months of emergency funds is downright a bad idea. He has other businesses and investments. Emergency funds should be dependent on each individuals requirements. Some will have more obligations and spouses and children.

I would prefer to be in over-prudent than over-exposed.

It's ok to listen to his channel, but make your own decisions. His videos doesn't explains everything and he has plenty of motivation to do so as well as to continue to maintain his current reputation.

Kenneth Lou

23 Nov 2020

Co-founder at Seedly

95% of portfolio into a single stock is pretty risky indeed...

I believe his strategy is to concentrate on a few outstanding stocks rather than diversify for the sake of diversifying. This can work well if you have done EXTREME in-depth research into the businesses, is EXTREMELY convicted of the business, and is EXTREMELY disciplined and emotionally stable to ride through the volatility that will come along with your portfolio. Also, it helps if you are able to enter the stocks before the masses/hype at a significantly low price (which I think is what ARK and CG did for TSLA. They entered really early into the stock), so even if TSLA now falls another -20%, -30% or even more, they would probably still be in the green.

At this moment where TSLA is already quite hyped up, I personally do not recommend to go all in on TSLA. However, if you still wish to go for this high-concentration strategy, what you can consider doing is to mix TSLA with other high-growth stocks (but provided that you do your EXTREME due diligence on the businesses and you should ideally already have some experience to ride through the volatility AND only invest money you can afford to lose).

Also, we do not have a clear picture of his total portfolio. Remember that Cash can also be considered as part of one's portfolio. His 95% TSLA holdings does not necessarily mean 95% of his TOTAL Portfolio. E.g. his TSLA holdings could possibly form only a small part of his entire portfolio including cash & other assets.

I believe Diversification is still key in investing because there is no 100% certainty. ​​​

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Different people have different ways of approaching investing. Ken believes over-diversification isn't as great. But of course, under-diversification could be dangerous too. He also has walk the walk, showing us his portfolio's performance from time to time.

Just take in what you reckon is good information and don't just blindly follow suit.

His videos are interesting BUT people should not copy him, especially beginners.

95% into a single ...

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