welcome back to another video today we're talking about weibull a cash account versus
a margin account why am i holding credit cards up because that's what we're talking about when
it comes down to margin i'm gonna break it all down for you but first i gotta say that a lot
of you have been asking on my other videos what is the big difference between margin and cash and as
always when you comment on my videos ask and you shall receive now of course i got to welcome out
my sweet life for subscriber family welcome back to another video and you know if you're not part
of that family make sure you subscribe because on this channel we talk about personal finance
and everything so you can become a future millionaire and live your ultimate suite life
now question of the day have you used margin before in a brokerage account if you have
comment below what kind of strategies did you use was it successful was it not let's hear from
you and if you're wondering well that's why i'm on a video because i don't know what margin is
don't worry i got you in good fashion as always i'm going to pull up my screen right here on my
iphone now don't worry i'm also going to show you the desktop version as well because i know a lot
of you some of you use the app some of you use the desktop we're going to break them both down today
and make sure you stay with me through the entire video because i have another bonus tip
to make sure that you're maximizing your weeble experience so that you're growing your portfolio
over a long period of time and i want to show you a way that you can make sure you're on track with
that opportunity so make sure you stick with me let's get through it with the app first i'm going
to break down exactly what all of these numbers mean because a lot of you had a lot of good points
in that weeble beginners tutorial that i had i'll link that video up above if you want to check it
out but let's break this down this is my portfolio currently at the moment you can scroll down here
you can see all of my positions currently at the moment with weibull this is not financial advice
make sure you do your own research don't just copy what i'm doing you got to do what's right for you
and what you're most interested in but at the top you can see it says net account value and right
now it's sitting about 9 200 that number will fluctuate because of course the market fluctuates
every single day every single minute but that's the net account value that means all of the shares
of stock down below here that i just showed you with anything that's in my cash balance it's right
here which is 55.90 if you add those two numbers together that's what gets you to 90 to 55-ish okay
now right down in the middle of the screen you can see another example that market value is 91.9939
plus 55.90 in my cash balance that equals the net account value now here's where things get a little
bit interesting do you see down below here it says day trade bp 24 363 dollars and then you see
overnight bp and that's sitting at nine thousand twenty dollars what the heck does that mean
that is what margin is now here's an important point you may be opening your weibo account
right now and saying wait i don't see that what's going on what's wrong with my app nothing's wrong
with your app my friend what happens is let's say you just opened your weibo account let's say you
put in a hundred dollars because you know if you sign up with weeble they give you free stocks and
then when you deposit your first 100 that you can freely trade with they sometimes give you
additional free stocks click the link down in the description below to see what kind of promotion
they're running because sometimes they can give you one stock two stock three stocks four stocks
it's worth checking out but if you only have a hundred dollars in your account
you're not going to see the margin you need a minimum of two thousand dollars in your weibo
account in order to activate margin so once you build your portfolio up to 2000 whether you're
seeing growth out of your stocks or you deposit 2 000 or more then you'll get access to margin
now weeble says in the day trade bp and day trade means when the market is open from 9 30 a.m to 4
p.m eastern standard time every day you can trade up to four times your net account value in margin
mine's a little bit under that right now with uh because if you add if you multiply 9200 times four
that does not equal 24 000 i think it's somewhere around 36 but it's up to four times so 24 000 is
what i can trade with when the market's open and then because weibo is awesome and has extended
hours you can also trade in extended overnight hours which i have uh two times so four times for
the day trade two times for overnight i will tell you and i'm gonna be transparent right up right
here right at the point i actually don't trade with margin even though i have it available here
i don't do it and i'll explain why in just a moment the cash balance right here i want to
dig into this for a second you see it says 55.90 that is my cash i can do whatever i want with it
i got that cash because i either won transferred money in for my bank account two got dividends
from dividend paying stocks or etfs or three i sold a share of stock or etf and when you sell
that goes into your cash balance now i can take that and transfer it into my bank account or i
can buy some additional etfs or stock so i can do that in many different ways i'll link a video up
above on how you can buy stocks in weibull because that's not the point of today's video but i can
take that 55.90 and do whatever i want with it so let me choose kbwi here it's going for 22.25 a
share i can actually buy one because i have 55.90 so i can buy a full share of that and it would
go through and process out of my cash balance i could actually get two shares because you can see
the estimated amount is 44.50 and i have 55 so i have enough to afford two shares of stock
now i could also go a little bit crazy okay i can go above my cash balance and that's when margin
comes into play so i can go back to kbw look what i can do i can buy look at that 1000 1073 shares
of kbwi look at the price 23 874 that would mean i'm trading on margin when you trade on margin
weibo is going to charge you an interest fee that's kind of how it works if you follow me
for any period of time you know right now my big focus is i want to pay off our mortgage early
i want to pay it off early so we can be come asset millionaires i don't want to have debt i
don't want to owe money to anybody and i hate paying extra money just to have debt kills me
and that's kind of what margin does for you i'm going to pull up right here on the screen so
you can check it out with me exactly what these guys are charging you when you trade on margin
so for your first zero to 25 000 if you have that leverage in your margin account as i
showed you right here on the screen they're going to charge you a margin rate of 6.99
and then you can see as it goes up if you have some crazy margin that you're trading on let's say
you're meet kevin and you got millions of dollars and you're trading on margin your interest rate
of course goes down a little better i should say your margin rate goes down the more that
you use but it isn't a waterfall effect so for example if you trade up to 25 000 you'll have 6.99
but as you trade now 26 27 28 29 000 it will then be six point nine nine percent on the first twenty
five thousand dollars and then six point four nine percent on the next five thousand dollars
whatever that would be so let's say you got 000 you got 6.99 trading on the first 25 000 and then
uh 6.49 trading on the next five thousand dollars and this kind of happens with any brokerage any
brokerage that you borrow on margin you are gonna have to pay a margin rate which i look at it as
a debt interest rate that's kind of how i look at that and you can do a couple things with that
a lot of people do a lot of day trading with margin they think okay this stock right here
is about to go up i'm going to trade on margin i'm going to buy a bunch of shares and i'm going
to sell it in the same day cover my margin rate because i'm gonna make more money than the 6.99
or whatever that percentage is and then take the profits and run there's a couple problems i have
with that first of all again i don't like trading on debt i don't like the risk of the casino of
saying okay what if something weird happens and it does fall down or it doesn't rise as much as i
wanted it to and then i'll end up having to pay extra money because it only rose three percent
and i'm on a margin rate of 6.99 oh if you're sitting here and you're like oh this is too much
information that is why i focus on investment apps for beginners because i don't like margin
i would rather say look i'm going to find a way to transfer about 100 bucks in or 55 bucks in and i'm
only going to use my cash balance to trade that way down below here on my weibo account as we just
explored everything i have invested is my tried and true hard earned income it's not some
margin rate i'm not a big fan of that now before i get to the bonus tip on how to make sure that
you're performing well in weeble i do want to pay some respects to our desktop users a lot of people
have been asking me for what uh does this look like from a desktop perspective in weeble so i'm
gonna pull that up right now okay so here we are on the desktop i'll be honest i use the app more
than a desktop so i bear with me as i go through this so you got the net account value right here
at the top just like we saw on the app and then right over here on the left you can see here is my
day trade bp and my overnight bp very similar to what we saw in the app and then the cash balance
so same type of deal here if you go into this and then you
basically buy a share of stock or an etf you just got to remember for yourself to use your cash
balance only the moment you step above that cash balance you're going to start trading on margin
and boom boom boom here come the margin rates now don't forget if you're finding this stuff helpful
smash that like button down below certainly would appreciate it and so would the youtube algorithm
now i promised you guys some bonus tips here you know it's not about cash or margin on this
bonus tip it's about how well are you performing and you can see right here at the top i have my
app screen up again it says open p l that means profit and loss now of course right now today my
poor sad example i am losing money so i am down okay it's jumping around here but i'm at 98
i'm gonna round that because you know it's gonna keep hopping around but i am down for today this
means for today that doesn't mean overall in order to find overall there's a couple things you can do
because it shows that open p l it's trying to tell you that is what's going on today just so you can
stay plugged in with the day's activity but what you want to do is come down here to the center and
click on performance once you click on performance that's where you can start to see what's going on
so if i go all the way to the left that means five days this is what my performance is in the
last five days you can see i'm down 54 86 in the last five days i can hop over to a month
you can see i'm down 41.86 and by the way the market's acting up right now i'm not worried
about it and you never ever ever ever ever sell when the market's down if you sell that's like
jumping off a roller coaster in the middle of the ride you don't do that you wait till the roller
coaster gets back up and then you can decide if you want to exit safely once it returns to the
station if you're jumping off and you're nervous and you're scared and you're selling at a loss
you're doing it all wrong guys you're not investing for the long term you're trying
to chase this dream of getting rich overnight and what's going to happen is that your fellow
suite lifers are going to live the sweet life because they were smart and they were looking
at what is the long term in this game so if you keep going i had some very bad ordeals
going here see three months six months you can see a little bit of a pop there that happened i
was in the green things were looking good and then i made some bad decisions of uh
you know buying some shares that started tanking i will tell you that neo is down not worried about
it i'm holding on for the long game you know i'm not going to sell it because again i don't jump
off a roller coaster at the wrong moment but you know that's what's kind of bringing me down right
now are these big tech stocks but again i know they're going to bounce back i got my apple i
got my neo and i'm just going to keep riding the wave until they start coming back up so anyway
that's how you see that and then you can say is my portfolio growing the way i want or is my strategy
the way i want to be now i'll tell you i could sit here and say oh my gosh i lost 532 dollars i'm
screwed i'm not worried about that because again you've got to invest with money you're okay losing
and what happens with that is you're playing the long game and then a year from now two years from
now 10 years from now you're going to look at this and that number is going to be different typically
it's going to be in the positive go google the s p 500 average rate of return over its course of
period of time you're going to see it gives you a number of about 10 percent so if you look over the
average of all the highs and all the lows and all the recessions and depressions and everything that
happened the s p has grown on average 10 which means that eventually this will turn green if i
hold for the long game and that's kind of the game and the goal of what i'm doing with my account so
so hop over to that performance and really pay attention to say okay this is what's going on
this is how i feel i feel good about it and another thing you can do is you can look at
your dividends that are coming in you got to buy dividend paying stocks if you're interested in
getting paid dividends that means every share of a company that you own they're going to pay
you either on a monthly or a quarterly basis simply for just owning a share of their stocks
pretty darn cool there is a dividend video coming so make sure you subscribe
so you don't miss out when that video drops but if this video was helpful tap that like button
down below make sure you comment if you have any other questions that you want to see me address in
a future video and until next time check out these other weeble videos that will help you
get a little bit more intuitive with this awesome app we'll see you next time on the next video