Stable profits are an issue faced by many investors. The fleeting champions in the investment field are hardly worth mentioning; time will ultimately reveal a person's self-control ability. Observing whether a person is trustworthy can only be done over time; no one can deceive everyone all the time. Looking back at the former boss of LeEco, Jia Yueting, he is now infamous, but a few years ago, he won the trust of many investors.
Why can some people achieve sustainable profits? Where is the root? Because these people have mastered the essence of investing.
First, let me give my views and conclusions: the essence of investing lies in 'understanding how to control trends and predict points, and patiently waiting.' This statement may disappoint many; it can be said that those who deeply understand such simple vocabulary and validate it through practical actions are the enlightened ones in the investment field, the very few who can achieve sustainable profits in the investment market.
Therefore, to succeed in investing, generally, one only needs to do two things well, and they have succeeded for the most part. The first thing: understand trends and choose appropriate entry points; the second thing: can wait. Those who continuously lose money in investing often do not do well in this regard, especially the first part.
(1) Understand trends
Understanding trends is the core of investing, the focus of investing, and also the difficulty of investing. Without years of investment insights and extensive reading and thinking, it is very difficult to comprehend the value of each wave of trends. How can one understand each wave of trends? By making appropriate and reasonable plans for each investment; aside from diligent reading and investing a lot of time to gain insights, there is no better way. In summary, a significant amount of time cost is unavoidable. Of course, smart people can learn from mentors, using monetary costs to save time costs and think from the shoulders of predecessors.
(2) Can wait
Understanding the value of trends means understanding whether market prices are reasonable, overvalued, or undervalued. Under this premise, one can buy the corresponding number of shares by typing on the keyboard, and the rest of the time is just waiting. Is waiting difficult? Many people think waiting is easy, but quite a few investors encounter problems during the 'waiting' phase. Investing is about capitalizing on time differences; time is the greatest wealth. Buffett once said, 'To become a long-lived person is beneficial for the accumulation and enhancement of compound interest.' During the waiting process, investors are easily influenced by their emotions and may give up on the positions they are optimistic about; during the waiting process, investors may envy others' outstanding investment performances and sell their previously favored trending positions. Making money in investing depends on those 'critical three to five days'; if you're not present during those days, the investment returns will naturally be unsatisfactory.
If understanding the prediction of trends is the 'hard skill' of trading, then 'being able to wait for the right point' is the 'soft skill' of investing. Combining both hard and soft skills can achieve the highest realm. No matter which aspect is skewed, achieving the final investment performance goal becomes difficult.
In summary, the commonality among investment experts is similar: they are people who understand how to predict trends and have the patience to wait for the right points.
