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what's up guys ben here and welcome to motivation to invest howard marks is one of the greatest investors of all time his legendary investing memos are read by the great warren buffett and he's the founder of oaktree capital one of the world's greatest investment firms so in this video i'm gonna reveal my take on howard mark's top three rules for investing success but before we dive into that if you're new around here why not consider joining the investing family by hitting that subscribe button and turning that notification bell on and if you wish to take things a step further then feel free to click that first link in the description below you'll be taken to the patreon page where you'll be able to find out more about the vip membership group this is where i reveal my buy and sell signals so when i make my moves you can make your moves in addition to my entire investing portfolio including the stocks and the story of how i built that portfolio from just twenty thousand dollars to over two hundred thousand dollars so first link in the description if you wanna find out more about that but that being said let's dive in so rule number three understand where we are in the market cycle now howard marx is famous for believing everything is governed by cycles the stock market credit real estate and of course investor psychology now the stock market is generally governed by fear and greed where you have pessimism and optimism and they tend to rotate and change as the market moves through different cycles now when optimism is overly high and overly exuberant this is when we see a market bubble this happened during the tech bubble in the late 90s 2008 financial crisis and the 2020 market crash just before that happened and just after that happened we have a stock market crash then there is fear there's blood on the streets there's despair that is actually one of the greatest times to invest and in the boom bust stock market cycle that is when we're in the bust stage history does not always repeat however it does rhyme so just because something happened in the past doesn't mean it will happen again in the future but generally things tend to follow similar trends when we tend to see overly optimistic too much excitement too much exuberance too much risk taking going on in the stock market that usually happens when we're in a bubble and then a crash tends to happen and after when people are fearful and they're running away from the market then that is usually when it's a great time to invest in the words of the great warren buffett be fearful when others are greedy and greedy when others are fearful this brings me on to rule number two by the great howard marks always control your risk and start with that first so how mark's philosophy is basically if the stock market goes up your portfolio will benefit however if the stock market goes down you won't be wiped out completely and you'll still survive there's an old story about the six foot man that drowned in the river that was only five feet on average it doesn't matter if the river's only five feet on average if at one part in the river it's seven or eight foot because then still the six foot man is going to drown so this is what you have to understand in the market and this brings me neatly onto rule number one of the great howard marks and that is understand the probability distribution so when you're making your investing decisions understand that there are multiple outcomes calculate a best case calculate a worst case calculate a likely case and then use that to judge what you're willing to pay for a stock because there are multiple possibilities including a black swan event and we saw this in 2020 with the march crash but that being said i hope you guys enjoyed this video you did find some value if you did please do big thumbs up and comment your thoughts below and if you're new around here and you still haven't subscribed yet what are you waiting for go ahead and hit that subscribe button and turn that notification bell on and if you want to take things a step further first link in the description below that'll take you to the patreon page where you where you can find out more about the vip membership group where you'll gain access to my buy and sell signals so when i make my moves you can make your moves in addition to my entire investment portfolio the stocks and the story of how i built that portfolio from just twenty thousand dollars to over two hundred thousand dollars but that being said i hope you guys enjoyed this video and you did find some value and i'll see you guys in my next video invest safe [Music] you