Warren Buffet’s 2023 Billionaire Blueprint (Risk Free) – Capital Raises – Investment Banking

In this video, I’m going to show you how to manage a risk like Warren Buffett by the end of this video. And if you make sure you stick to the end, you’ll have the two key things that you need to keep in mind when you’re looking at making big financial decisions. And obviously this is not financial or legal advice specifically tailored to you, but make sure you understand the bits and the pieces before it’s too late.

So right now, a lot of people are looking at different moves that are happening. In the market. Generally, there are two main things to focus on when you’re making a big financial decision and you’re dealing with risk. You have the impact and you have the probability. So if let’s say that you want to buy a real estate deal and then you’re not sure of how to do it and you’re a beginner real estate investor, you want to make sure you understand what impact and risk are or rather impact.

You want to make sure you understand what impacts and probability are. So the impact means the worst case that could happen if something takes place. So let’s say you’re looking at buying your first raised capital to buy your first real estate deal or your business. You’re buying a business using other people’s money.

And you’re, you try to understand what are the risks involved in doing this. So you look at the worst potential risk of the impact that could happen. Let’s say if the business makes no money in five years. You look at the impacts of how bad that would be and what, how that affects you legally, financially, psychologically and everything.

So you look at the worst case scenarios, and you look at the impact of these scenarios. That’s what you do. And then the next thing is that you look at the probability of these scenarios happening. So, it’s not only how bad things could happen, things can go, it’s also looking at the probability of them happening.

So, when you combine them both, then you’ll be able to navigate properly. So imagine somebody who’s walking across a big cavern, and they see different holes in the ground. You have one hole in the ground that’s really deep. But it’s really narrow, so you step right over it. But if you fall into it, you can actually fall down, like, 50 feet.

It’s an extremely deep sinkhole. And then there’s another hole after that hole that is really wide, but really shallow. Like, it’s really easy to fall into that hole. The, but it probably wouldn’t even hurt your ankle. Probably it would just be like a, worst case, you twist your ankle a little bit and you’d be fine.

But it’s really easy to fall into that hole, because it’s a really big hole. So the first hole that’s really deep and narrow, that’s a high impact, low probability situation where the chance of something going wrong is very low, but if it does, it has a tremendous impact. And then the second hole is an example of something that goes a little bit, uh, that goes a little bit wrong.

Like maybe you just, you get hit with a tax bill you don’t expect, that’s not that bad. Or you deal with a customer complaints that you resolve for something. Then, but then the chance of that is really high. But then you deal with that and then you go forward. So the point I’m making is you want to know both the two dimensions of risk.

And then when you do that, then you’ll be able to make better decisions. And you won’t confuse things that are urgent with things that are important. Because it’s always important to manage the downside. And as the millionaires do, and in a book called Money Master of the Game by Tony Robbins, he focused on managing the downside risk and on removing the downside completely.

Because investors… usually won’t put themselves in a position where they’re taking any huge financial risk, but they’ll make sure that they’re getting a huge upside. So, you’ll want to remove, even if there’s a low probability, you’ll want to remove things that can completely wipe you out. Because if you lose a lot of capital from the decisions that you make, it could set you back a year, and the time to recover would be so horrible that it’s not even worth even taking the chance.

Whereas, if you just take small risks that are really capped, that may have higher probability, Perhaps it wouldn’t be that big of a deal. And the last thing we have to share is really basically lower these risks and the lower the probability of risk going wrong is usually through experience and knowledge.

There was a show where Stephan Graham, there was a show where the YouTuber Stephan and Dave Ramsey went to the show and he said, what should I invest in? I’m too overexposed in real estate. I have about 60 percent or something of my assets in real estate. And then. And then Dave Ramsey said, don’t worry too much about that because how much about real estate do you understand and know he said, Oh, about like 90 percent of my money in real estate.

So the point is, risk mostly comes from that which you don’t understand. And Warren Buffett usually would say things about putting money in things that you understand. That’s why he recommends to the average public to just put their money in the S& P 500. This is the Standard and Poor’s. 500 top companies in America, just stocks that you invest in.

It’s an index, which is a collection of companies you can invest in in the public market. You remove the downside risks, because the average person doesn’t really understand that much about anything. But, if you actually know more about, let’s say you work at Tesla, and you understand everything about Tesla, and you’re able to buy a Tesla stock, because you know it’s going up, it will make sense to allocate more towards Tesla because you understand it.

So, with this, if you want to work with my team in Raises. com and actually create your private equity deal and raise money, Head to razors. com, but if you’re not ready to do that and you want to learn about how the process works Make sure you watch the next youtube video and it’s somewhere on the screen Which walks through a lot of some of the key concepts that we talk about and so with this We’ll see you in the next one

Warren Buffet’s 2023 Billionaire Blueprint (Risk Free) – Capital Raises – Investment Banking

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