The following are some of the few practical lessons that I learn in my years of investing. They make a lot of sense even though they may be some common wisdoms that many people have experienced.
- In investing, simplicity is the key. It is no point to apply all kinds of methods, all kinds of strategies and make things very complicated just to chase the last 10%. At the end of the day, it is the end results that counts. It is like a game of football. Your opponent can control 90% of the time with all kinds of patterns. All you need is one strike at goal to make the end results 1-0 to win the game.
- The best sell situation is when we have absolutely no pressure to sell, and the best buy situation is when everyone is queueing to sell us the same product.
- One can win (or lose) when buying into in a good stock. One can also win (or lose) when buying into a lousy stock. What separates the two is that buying into a good stock is like buying an unrestricted ticket and buying into a lousy stock is like buying a restricted ticket. If we miss the 1st bus or train holding an unrestricted ticket, we know that there is always a next bus or train, but if we hold a restricted ticket, there is always a pressure to take the immediate bus or train. So, it really depends on what tickets we want to buy.
- Based on my father’s living history, I have only 30,000 days to live on this mother earth. By today, I have already used up half of it. I do not want to spend the other half of it in front of the screen monitor watching the stocks movement, and certainly do not want to die in front of it.