[Long Money Column] Long-term Money Research Column No. 2 - Let's talk about asset management
Author:yh
Review: kk
Why do ordinary people need to manage assets? How to manage assets? How to plan investment assets? Web3 investment real market. Off topic, long-term holding requires good health
Here we are, my family. This is the second issue of the Changqian column, talking about asset management for ordinary people.
Why do ordinary people need to manage assets?
First of all, let’s review our long-term money philosophy:
Make money easily
Good assets + good price + long-term holding
The asset management we are going to talk about today is to serve the long-term holding of this concept.
Many readers may think that asset management is something that only big investors need to pay attention to. This is actually wrong. We ordinary people need to do a good job of asset management before we become big investors. Does it mean that if you suddenly become a big investor, you will suddenly be able to do a good job of asset management? This is done step by step, unless you directly hire a financial expert to help you manage your finances, but this is beyond the scope of ordinary people.
We should have this mindset: we are running our own account, which is equivalent to running a company, and you are the only boss + shareholder. You are responsible for your investment and the direction of every penny. As our planning improves, the company's cash flow will tend to stabilize, and total assets will also increase. As time goes by, everyone will feel a sense of accomplishment when they see their asset curve rising amid fluctuations, and at the same time, it will strengthen everyone's confidence in long-term holding.
How to manage assets
This is actually a very profound topic. It is so flexible that everyone's current asset allocation situation is very different. I have also studied it for a long time. In order not to waste your time, I will skip a lot of research and give the results directly. Of course, I am also practicing this plan myself.
First, we divide the property into three parts:
cash
The money you plan to spend in the next one to three years
Money not used for a long time
The first part, cash, refers to the money that covers the expenses of one's own necessities. Necessary food, clothing, housing and transportation, covering the minimum survival needs, and possible emergency cash needs. If you have a salary, this part is about 3-6 months of salary. If you don't have a salary, divide it according to your living habits. Assets are allocated to Yu'ebao, Chaochaobao and other fast-redemption money funds, with a return of about 2%.
The second part is the money you plan to use, which is used in the next one to three years, such as to improve your life. For example, you have plans to change cars, change houses, raise children, etc. There is no fixed proportion for this part of assets. It depends entirely on your plans for the next three years. This part of money is not suitable for more aggressive investment. After all, when you really need to spend money, the market is at the bottom, and you will feel very uncomfortable. Allocating assets to relatively stable bond funds can yield about 3-6% returns, because the holding period is about 1-3 years, which can resist the risk of fluctuations.
The third part is the money used for venture capital. This is the part of your total investable assets minus the first two parts. The money for our web investment real account is also allocated from this part. What to invest in this part and how to invest will be explained in a separate chapter. Our overall expected return is 10% annualized, not too much, because most of my assets are still in stocks. Web3 investment is a small part of it. For the return on web3 investment, our web3 expected return is 20% annualized, not too little.
How to plan investment assets
The results of the survey are also omitted here, and the conclusion is posted directly.
First, diversification is important.
The risks of investing in the A-share market, US stocks, web3, and Chinese real estate are all very high. The Chinese real estate market has been rising for so many years, but now it has shrunk. There is no long-term investment. In theory, if your asset allocation is sufficiently diversified, your asset growth is approximately equal to the growth of human productivity. Our goal is to take advantage of the growth of the market. Whether we can get excess returns that exceed the market depends on our specific operations (it is a thankless task, and this operation is actually not easy).
Here I directly copied the asset allocation of the Canadian Pension Fund, which is basically the optimal framework recognized by the industry today.
Bonds 10%
Fixed assets (houses, cars, land, warehouses, machinery, etc.) 20%
Stocks and other venture capital 70%
In the past, most Chinese people invested their money in houses, and fixed assets probably accounted for the majority of the percentage. Now it is necessary to actively adjust the asset allocation.
Among them, risky investments such as stocks occupy the absolute mainstream, which is to allocate global stock markets (A shares, Hong Kong stocks, US stocks, Germany, gold, crude oil, etc.), plus our investment in the web3 field.
I plan to allocate 40% of my portfolio to A-shares, 40% to US stocks, 10% to other investments such as emerging markets, and 10% to web3. You can make your own plans. I don’t know if you have ever heard of the term “fuzzy correctness”. The percentages here do not really need to be strictly achieved, just try to get as high as possible.
Web3 investment will probably account for 10%-30% of my total investment assets. The following is the real trading session that everyone likes.
web3 investment real money
I forgot to chat and I forgot to report our actual trading to all shareholders.
The market fell a lot this week, and the AHR999 index reached 0.7165. Our assets were also affected a bit, after all, we are almost all in BTC. The mentality of value investment is that the more it falls, the happier I am, because I am still in the fixed investment (which can be understood as building a position). Moreover, the AHR999 index is still in the fixed investment range, and has not yet reached the bottom-hunting range of 0.45. I still look forward to the arrival of the bottom-hunting range, which will be the real best buying point at that time.
By the way, our current investment is only 1500u, and our final total investment will probably be above 30000u. Now we have only bought less than 5%. I am afraid that everyone will follow me and buy too hastily. It will be funny to leave the market with a loss in the end. This is a long-term investment process. Everyone should manage their own assets well, and calculate the most suitable daily fixed investment amount according to their actual situation. This fixed investment amount should not affect their life, and can be invested for a long time. Try to be conservative to last.
I will continue to invest 70u this week. Due to the decline, the average cost price has reached 62061. We started buying it from 70000. This price is okay, right?
At the same time, we have used the BTC purchased through fixed investment in dual-currency investment. By August 30, 2024, we will be able to obtain an additional 0.00054066 BTC.
The overall profit and loss situation shows that the assets have shrunk compared to last week, but it is not a big problem. The more it falls, the more excited I am. My goal is the stars and the sea.
Off topic, long-term holding requires good health
Playing ball, exercising, and keeping a good attitude are the true meaning of life. Investment is just a part of life. Don’t take it too seriously, but it will give you a surprise one day.
