00519 The Highest State of Investing: Getting Rich in Boredom, Staying Firm Amidst Risk

I. Main Theme of the Session

#

This session revolves around “The Long-term Practice of Investment Mindset and Asset Allocation.” The core message is that investors should cultivate a transcendent mindset of “it has nothing to do with me,” remaining calm in the face of external factors like international situations and economic data, and firmly believing that the market will trend upwards and reach new highs in the long run. It emphasizes achieving financial freedom through reasonable asset allocation (e.g., Nasdaq 100 index funds combined with ample cash) and passive management, and drawing strength for life and investment from wisdom such as “I might be wrong” and “life is worthwhile.”

II. Briefing Content

#

Investment Mindset and Market Outlook

#

• The Market Irrelevance Theory: Macro factors like international situations, financial reports, economic data, and interest rate decisions have no direct correlation with an individual investor’s long-term success. One should adopt a mindset of “it all has nothing to do with me.” Market volatility is normal and not worth worrying about, as you can’t control it anyway.
• Always Be Extremely Optimistic: Firmly believe that the market will inevitably rise and set new historical highs in the long run. Investing requires patience, and wealth is worth the trouble and the wait.
• Recommended Books/Films for the Mind:
  1. “I Might Be Wrong” (The Illumination of a Forest Sage): This book recounts the life insights of a man (from Europe, as the teacher recalls) who spent over a decade (perhaps 14 or 16 years) as a monk in a Thai forest. The core takeaway is to tell yourself “I might be wrong” three times before arguing or getting angry, to calm your mind and self-reflect. It emphasizes practicing the state of “no-self” and learning to live harmoniously with all kinds of people.
  2. “Life is Worthwhile” (Audiobook): This book contains the professional insights and life experiences of an elderly female Japanese psychiatrist. Through numerous patient cases, it explores how many psychological barriers stem from “attachment.” Her life experiences (e.g., maintaining a less-than-perfect marriage until her husband passed away in his 70s so that both parents could stand on the stage at their children’s weddings) are thought-provoking. The core message is to let go of attachments and appreciate life. The teacher believes that, aside from the somewhat fatalistic view on marriage, the book is very beneficial for one’s outlook on life.
• Boredom is the Highest State: “Hold stocks in your hand, but not their prices in your heart.” True investing should be boring, requiring only 5 minutes of operation and review each year. If it feels exciting, you’re likely speculating or gambling, as if you’re in Las Vegas.
• Coping with Anxiety: Don’t create your own troubles in life. If you can handle something, face it and get it done. If you can’t, since it’s beyond your control, let it go without worry.

Asset Allocation and Risk Management

#

• The Importance of Cash is King:
  • For Retirees: It’s recommended to hold total assets equivalent to 50 times your annual expenses. Of this, 30% of your assets (equivalent to 15 years of living expenses) should be held in cash or short-term treasury bonds. With 15 years of living expenses in cash, nothing in the world concerns you.
  • For Working Individuals: You usually can’t hold 15 years’ worth of cash. You should continue to save and invest, and the world’s affairs also have nothing to do with you.
• The Ultimate Perspective of Life: In life-or-death moments (like the last day of your life), wealth, stock losses, and asset security become irrelevant. Therefore, don’t worry excessively about things you can’t control in daily life.
• Initial Asset Allocation Principles (Pledged Investing):
  • Beta Control: The initial Beta of your asset allocation should not exceed 1.0. For example, a 40% non-leveraged fund (QQQ) + 30% leveraged fund (QLD) + 30% cash (433 allocation) is an aggressive setup. A 40% QQQ + 20% QLD + 40% cash (424 allocation, Beta 0.8) is also a solid choice. Aggressive allocations like 442, where the Beta might exceed 1.2, are not recommended at the beginning.
  • Proportion Limits: The market value of the leveraged fund should not exceed that of the non-leveraged fund, nor should it exceed the cash position.
  • Prudent Choices: Even without using leveraged funds, a pledged allocation like 70% QQQ + 30% cash, or 60% QQQ + 40% cash, can withstand risk tests. Prioritize stability, with returns being secondary.
  • Coping with Extreme Scenarios: This allocation must be able to withstand a market downturn lasting 10 years, like the one in 2000 (in reality, it took about 13-15 years for the market to fully recover and significantly surpass its previous high).
• The Role of Cash: Cash is key to protecting the safety of your long-term investments (the “army” of non-leveraged funds and the “marines” of leveraged funds).
• The Worst-Case Scenario Principle: Envision the worst possible situation and create a plan to deal with it. Once you have a solution, anxiety will diminish. For example, if you get laid off, the worst case is being unable to find a job for a year. Plan how to prepare funds and how to find a temporary job for cash flow. For disasters beyond your control that you can’t prevent (like a nuclear war, as Buffett mentioned, or a meteor hitting Earth), worrying is useless, so let it go.
• A Long-Term Investor’s Perspective: Don’t fear market downturns; instead, fear that the market rises too quickly, preventing you from buying enough (like the market’s rapid rebound after the tariff war). Downturns are buying opportunities. Resolutely do not sell core assets (like QQQ, 00662). It takes multiple experiences (e.g., 7 major slumps) to learn to buy the dip. You can choose not to buy, but you must never sell.
• Discipline for Leveraged Investing: A reminder that for leveraged investing, the initial cash allocation must exceed 30% (40% is also fine), with limits on the proportion of leveraged funds and a Beta not exceeding 1.0. This is emphasized because too many people ask the same questions and make allocation mistakes.

Spreading and Learning the Investment Philosophy

#

• The Importance of Accompaniment: Investment success isn’t just talk; it requires long-term accompaniment and guidance. Teacher James is dedicated to this, hoping to awaken more people to capitalism and that his followers will pass on the philosophy, change the world, and free themselves and those around them from financial worries.
• Learning Resources: Newcomers are advised to start with videos 00451 “An Investment Lecture for Value Investors,” 00398, 399, 400, 401, etc., and understand them in the context of the current market. The main recommendation is the Nasdaq 100 index fund (like QQQ), combined with cash or short-term treasury bonds. Relevant handouts and links will be provided on the Clubhouse message board and in the pinned comment on YouTube.
• Call for Promotion: We hope everyone will subscribe, leave comments, and like our content on all platforms where you find our channel. Subscriptions and likes help promote the videos to a wider audience. Although the click-through rate is not high (about 5.5%), it is still an important way to spread the word.

III. Q&A Session

#

Ba

#

• Sharing 1: I’ve watched every episode this year and find that the Clubhouse platform has the most comprehensive information and links. YouTube Music is also a good experience, but finding consecutive episodes on YouTube can be a bit inconvenient. I hope there could be a central place for all handouts and links shared by the teacher.
  • Teacher James’s Comment: The YouTube channel has playlists, such as the “Weekly ClubHouse” series which already has 39 entries and can be played in order. There is also a playlist for short videos with 595 clips. Using playlists makes it easy to listen continuously.
• Question 1: In the smart rebalancing model you mentioned, during an uptrend, 30% of the profits from QLD are moved to SGOV, and during a downtrend, 2% of SGOV is moved to QLD. Is this 2% related to the previously mentioned “using 2% of your assets annually for living expenses”?
  • Teacher James’s Reply: In smart rebalancing, during an up year, you move 30% of that year’s appreciation from the leveraged fund (like QLD) into cash (like SGOV). In a down year, you move 2% of your total assets (equivalent to a portion of living expenses or a planned investment amount) from cash into the leveraged fund. For retirees, the core principle is to ensure your cash reserve can last at least 15 years, because after a market peak, it might take up to 15 years for a non-leveraged fund (QQQ) to have a high probability of doubling. For example, if you start with 50% cash and 50% QQQ, and the market falls for several years while you rebalance, you must ensure the remaining cash can still cover living expenses for (15 years - years passed). A strategy of 70% QQQ + 30% cash, without touching the cash for 15 years, is another option. The key is the “15-year cash buffer.”
• Question 2: The total assets of the U.S. are about $200 trillion (200T), with the stock market being about $50T. What comprises the other $150T? Is there an index to track the flow of funds between the stock market and cash?
  • Teacher James’s Reply: The remaining assets include real estate, mineral resources, various physical assets, etc. There is currently no specific public index tracking this kind of macro fund flow. The total assets of the U.S. are enormous and grow substantially each year (e.g., by $20-30T). Its debt (about $36T) is not a major issue relative to its total assets and annual growth, so the public shouldn’t worry too much. In comparison, an individual investor’s balance sheet risk might be higher. As for the claim that Social Security is going bankrupt, I’ve been hearing that for 40 years. There’s no need to worry; the U.S. can solve it. The Social Security fund itself is more like a pay-as-you-go system, where contributions from new workers pay for retirees’ benefits, rather than a massive investment fund.

Kevin

#

• Sharing 1: I am an investor from mainland China and also a Christian. Last year, I sold a primary residence and invested the funds. I feel like a steward of money with a responsibility to manage it well. I originally planned to dollar-cost average into USD and have opened an account in Hong Kong. After listening to your classes recently, I’ve been deeply moved by your selfless dedication and strongly agree with your investment philosophy. My current plan is to use my wife’s and my annual $50,000 foreign exchange quotas to transfer funds to Longbridge Securities and gradually buy assets like QQQ. I’ve also bought some 513100 in the domestic A-share market. Our total capital is about 3 million RMB. I plan to deploy most of it in Longbridge Securities within six months, keeping a small portion domestically. Is this a reasonable approach? I considered using HSBC for pledging, but the threshold is high (over 1 million HKD), transferring from Longbridge to HSBC has fees, and HSBC’s management fees might be high. I plan to wait until I have enough capital to transfer it to HSBC all at once.
  • Teacher James’s Comment: Your approach is reasonable. You can first accumulate assets in Longbridge Securities and then transfer them in one go when your capital reaches HSBC’s pledging threshold or when you are ready to pledge. This is more economical. Investors in mainland China generally lack financial literacy; many get hurt after entering the market blindly and then stay away, including Kevin’s own wife who suffered losses in the stock market in 2015 due to the wrong philosophy.
• Sharing 2: I deeply resonate with your sharing on both the “technique” (术) of investing and the “way” (道) of life. I also listen to Pastor Stephen Tong’s sermons and have many reflections. Thank you for your efforts. You’ve mentioned Confucius and Zhuangzi; I was wondering if you’ve come across Pastor Tong’s sharing on these topics?
  • Teacher James’s Comment: Thank you for sharing, Kevin. I haven’t specifically listened to Pastor Stephen Tong’s sharing, but I maintain an open and learning attitude towards various religious and philosophical thoughts (Christianity, Buddhism, etc.). If it’s recommended to me, I’ll listen, as I believe all great truths are interconnected. The core of investing is this: we own companies (like the 100 companies represented by QQQ), and we shouldn’t sell them easily just because of external opinions on their stock prices (Mr. Market’s neurotic quotes). Focus on long-term holding and accumulating shares, just like accumulating real estate, but with better liquidity. Investing should be passive and simple. You only need to spend 5 minutes at the end of the year (e.g., Dec 31st or the market open on Jan 2nd or 3rd) to rebalance once. Avoid emotional trading based on short-term market fluctuations, which will only get you into trouble, like being influenced by Mr. Market and becoming a “lunatic’s lunatic.”

Huayin

#

• Question 1: In your Excel model for maintenance margin calculation, are leveraged funds excluded? Is this also the case in Taiwan?
  • Teacher James’s Reply: Yes, in the models of U.S. brokerages, leveraged funds usually cannot be used to calculate maintenance margin because they cannot be pledged themselves. If a Taiwanese brokerage allows leveraged funds to be pledged, its risk tolerance would be better, and the calculated maintenance margin might include the leveraged portion.
• Question 2: My investment journey has been: 0056 (high-dividend) -> 0050 (Taiwan 50) -> 00646 (S&P 500 ETF) -> 00662 (Nasdaq 100 ETF). I recently re-listened to one of your earlier sessions (possibly 00451 or another early one) where you mentioned that if one doesn’t have enough money, they could buy 0056 and live off the 4% annual dividend for retirement. Did I misunderstand? It feels like I’ve come full circle.
  • Teacher James’s Reply: You didn’t mishear. Different strategies apply to different life stages and asset sizes. If you are still relatively young, you can use a 433 (QQQ non-leveraged, QLD leveraged, cash) allocation for aggressive growth. If you are close to retirement and your assets are not enough to support a 2% annual withdrawal (i.e., total assets 50 times your annual expenses)—for example, you need 1 million per year but have less than 50 million, maybe only 30 million—then a less volatile option like 00646 (S&P 500) with a 3% annual withdrawal might be a choice. If your assets are even smaller (e.g., only 20 or 25 million), then a high-dividend ETF like 0056, withdrawing the 4% dividend to supplement your living expenses, is a reluctant but realistic option. The 0056 plan is for special cases of insufficient assets; the mainstream, ideal allocation is still centered around QQQ.
• Question 3: If I am about to retire and the market happens to be in a major downturn, at a low point in the model, how should I reposition my assets and plan my living expense withdrawals?
  • Teacher James’s Reply: You should base your 2% annual living expense calculation on the total asset value at the market’s peak before your retirement. For example, if you had 50 million at the peak and planned to spend 1 million a year. Even if the market then drops for three years and your assets shrink to 25 million, you should still try to maintain your 1 million annual living standard (if your cash reserves allow). Because the market has already been down for several years, the risk is actually lower. You’ve passed a three-year window, and you should trust that the market will recover in the coming cycle (15 years minus the years passed).
• Question 4: I am a Taiwanese investor and I buy 00662 with TWD. If the TWD appreciates significantly in the future, will my assets shrink as a result?
  • Teacher James’s Reply: In the long run (e.g., 20, 30, or even over 40 years), the impact of currency fluctuations tends to approach zero. For instance, the TWD/USD exchange rate has historically fluctuated between 25 and 33. Your buying and selling (or spending) is a continuous process, not a single point in time. So, don’t worry too much about currency issues; it’s not within our consideration.
• Question 5: There’s a U.S. law (the student mentioned “Law 899,” possibly referring to FATCA or another tax law for foreigners), will it affect us Taiwanese investors?
  • Teacher James’s Reply: That (usually referring to FATCA, etc.) has little to do with Taiwanese people, so don’t worry. It mainly targets countries with unequal tax treaties or reciprocal relationships with the U.S., like some G7 countries in Europe (Germany, France, UK, etc.).

Rui

#

• Sharing: Thanks for your previous advice on my work issue; my mindset at work has improved a lot. I recall reading the book “I Might Be Wrong” (the author is Swedish) and noted down two points: 1. Secular success doesn’t necessarily bring happiness. 2. Focusing on your breath can train your brain. I didn’t quite understand it back then.
• Question 1: With your rich experience and having reached your current level, what do you think ultimate happiness is? Also, there are many methods for practicing breathing now (like in yoga); do you have any specific experience with learning to breathe?
  • Teacher James’s Reply:
    • Breathing: It’s very simple, just “observe your breath” (观呼吸). Notice your own inhales and exhales, know that you are breathing. This is observing the breath. Doing so will naturally clear your mind, eliminate distracting thoughts, and enter a state of “presence,” a relaxed state focused on the now. We often forget we are breathing during the day, which means we are in a tense state.
    • Happiness: Happiness is not determined by secular success or external evaluation. The value of a stock has nothing to do with me. The only thing to focus on is yourself. True happiness comes from within. Practice methods: 1. Observe your breath. 2. Practice introspection (similar to meditation or Christian prayer), empty your mind. 3. Relax your entire body (from head to toe), you can lie down, sit in a chair, or sit cross-legged. 4. Enter a hypnotic state (possible after long practice). 5. In the hypnotic state, give yourself positive affirmations (Re-programming), for example, tell yourself “I am happy, I am happy, I am happy,” “I am wealthy, I am wealthy, I am wealthy,” “All the money in the world is mine, all the money in the world is mine, all the money in the world is mine,” “All the market’s money is mine,” “My stocks will always go up, up, up, up, only up and never down.” Curve your lips upwards, practice smiling. Happiness needs practice. This is the basic skill of hypnotherapy. I recommend the “Rachel’s Hypnosis Channel” on YouTube, which has many guided sessions for different needs (like improving sleep, increasing wealth, relaxation).
• Question 2: I previously had some money in Firstrade (about 4 million TWD, 5-6% of my total assets). Recently, I’ve heard some concerns about overseas brokerages and plan to wire this money back to Taiwan. My current asset allocation is 433. After this money comes back, should I directly convert it to TWD and buy 00670L (Taiwan’s Nasdaq leveraged ETF), or should I use this “small amount of money” to invest in QLD (since the amount is not large, it won’t exceed the 7.5 million TWD tax exemption for overseas income by much)? I want to slightly adjust my overall allocation from 433 to 424.
  • Teacher James’s Reply: As long as your total cash reserve remains above 30%, the market value of your leveraged fund does not exceed your non-leveraged fund or your cash position, and the overall Beta of your portfolio does not exceed 1.0, you can proceed as you wish.

Brian

#

• Sharing: I always wanted to be a “big shot” (senior manager), so I left a large company for a VP role at a small Singaporean firm. My salary doubled, but my workload also doubled. I was basically working 7 days a week, 18 hours a day, with no personal time, not even on Sundays or evenings. What was worse, in my third or fourth week, during a meeting with the company’s CTO, he was extremely rude (saying things like “a one-year-old child could have made your presentation,” and “what did I hire you for?”). I was very upset and felt verbally abused. Then I remembered your words and realized it wasn’t worth it. I contacted my former boss at the big company (who said, “Didn’t you say you were going on leave?”), and he welcomed me back. I quickly resigned and returned to my old company. Although I’m not a “big shot,” I feel it was the right decision. That one month at the small company was miserable; there was no happiness. It seems more money can’t buy happiness.
  • Teacher James’s Comment: Brian, you did the absolutely right thing! Cutting your losses in time and leaving an unsuitable environment is crucial. Just as we shouldn’t buy or sell based on stock price fluctuations, we shouldn’t choose or leave a job solely based on salary. Happiness is priceless, “worth a thousand pieces of gold,” and far more important than a high salary. When considering a job, the first question to ask is “Am I happy?” If you’re not, you should leave. Happiness is a human right. You shouldn’t accept anything that makes you unhappy. First, remove external sources of unhappiness, then cultivate inner happiness. Young people should try to work for large companies. They have more resources, better systems, and you can learn more (learn systems, management, learn in a big ocean), and the career paths are broader. If you encounter a bad manager or department in a large company, consider an internal transfer (the manager might be transferred, but a good company will remain), rather than resigning hastily. I myself proactively sought an opportunity to be transferred from Acer Taiwan to the US.

L

#

• Question: I am an old student who started following you during the market low in 2002, and you gave me a lot of confidence back then. Recently, there’s a trend in our group to share that if you use a large amount of cash from your pledged loan, you should prepare twice the borrowed amount in cash as a buffer. To meet this requirement, I sold some of my QLD to supplement my cash, which brought my Beta down very low. Now, I have a new sum of money coming in. Should I use it to pay back part of the loan, or to buy back the QLD I sold? Cheng Feng’s advice was that if you use a large sum of money, you need to adjust the entire portfolio proportionally, including the non-leveraged fund (QQQ). Does this conflict with your frequent advice to “never sell the core fund”? Also, I think Kate said that new funds coming in shouldn’t be used to return to a fixed ratio allocation? I’m very confused and feel like I haven’t grasped the core idea after following you for so long.
  • Teacher James’s Reply: Cheng Feng’s understanding is correct. When you “borrow and spend” a large amount of cash from your pledged account (e.g., 10% or more of your total assets, like borrowing 1 million from a 10 million total asset base), this is a special situation that requires a “re-navigation” or “re-positioning” of your entire asset allocation.
    • Example and Adjustment Steps: Let’s say you originally had 10 million in assets with a 433 allocation: 4 million in QQQ, 3 million in QLD, and 3 million in cash. Now, you need to borrow and spend 1 million for an emergency.
      1. For this 1 million loan, you need to set aside an additional 2 million in cash as a risk buffer (because you borrowed 1 million, you prepare 2 million in cash).
      2. So, out of your 10 million total assets, 2 million in cash is specifically designated to cover this loan risk. The remaining 8 million (10 million - 2 million) is then allocated according to your target allocation (e.g., 433, or adjusted to a more conservative Beta of 0.8, which corresponds to a certain proportion). Specifically, a 433 allocation for 8 million would be: 3.2M QQQ, 2.4M QLD, 2.4M operational cash. Add the 2M risk buffer, and your total cash is 4.4M. In this case, the leveraged fund is 2.4M, which is 24% of the 10M total assets, contributing a Beta of 0.48; the non-leveraged fund is 3.2M, contributing a Beta of 0.32. The total Beta is 0.8.
      3. In this situation, selling a portion of your existing QQQ and QLD proportionally and combining it with your existing cash to create the 2 million risk buffer and the cash needed for the new allocation is a reasonable “asset structure adjustment.” It’s not considered a “sale that violates the never-sell principle.”
    • New Capital Injection: When you have new funds coming in (like the new capital you mentioned), you can use them to restore your QLD position or to supplement the relevant parts of your “re-navigated” target allocation (which might be Beta 0.8). Restoring QLD to bring the Beta back to 0.8 is fine; it doesn’t have to go back to 1.0.
    • Kate’s Viewpoint: What Kate said about “new funds not being used to return to a fixed ratio” usually refers to routine, small-scale additions of capital. In that case, you don’t need to strictly follow the initial 433 ratio; you can flexibly add to the part you feel needs strengthening the most (e.g., add to cash if it’s low, or add to the leveraged position if you want to increase it). This is a different scenario from the “re-allocation” after a “large withdrawal and spending” that you described. When a plane is on autopilot, small adjustments are fine. But if the number of passengers changes significantly or the destination changes, you need to re-plan the route and fuel.
    • Conclusion: Under normal autopilot (small fund inflows/outflows or rebalancing due to market fluctuations), the core asset is not easily touched. But when a major event like a large withdrawal for spending occurs, changing the overall risk structure, you need to re-evaluate and adjust the entire allocation. Following for a long time doesn’t guarantee you’ve learned well; the key is to learn the core principles.

JASON

#

• Sharing: I want to share some risk points about the direct selling (or MLM) industry, as I heard a user mention wanting to return to Taiwan to do direct selling to change their situation.
  1. High entry fees: Be wary of these.
  2. No substantial product or service: Or the price of the product/service is severely disconnected from its market value (e.g., selling wine from Maotai Town at an exorbitant price; something worth a few hundred sold for thousands).
  3. Focus on recruiting downlines, ignoring consumer experience.
  4. Different purchase prices for agents at different levels.
  5. Promises of quick riches through IPOs, dividends, or stock options: Especially with newly established companies that lure you into buying a lot of inventory at once.
• Advice for Choosing Direct Selling:
  1. Mainland China: Look for companies with a direct selling license issued by the Ministry of Commerce (a total of 88), which are relatively legitimate. There are now many new retail, social e-commerce, and micro-business models whose underlying logic may be similar.
  2. US or other regions: Choose companies that have been established for over 10 years, preferably publicly listed ones (financial reports are public and transparent, and can be analyzed). Only about 10% of new companies survive for three to five years; most fail within five years.
  3. Long-termism: Even with legitimate direct selling, it requires long-term commitment (at least 5 years). Don’t expect to get rich quick. If it feels like a “great opportunity” for rapid change, there’s a high risk of being scammed.
  4. Beware of “Direct Selling + Insurance” models: In the US, services can also be sold via direct selling. The combination of direct selling and insurance requires special caution, as it can be highly deceptive, seeming to offer both income and security. Chinese direct selling law requires physical products and a factory.
• Teacher James’s Comment: JASON’s reminder is excellent; scams are everywhere. Everyone should be wary of messages that demand urgent action (e.g., “Your payment of $698 has been successful, please call this number if you have questions”), or else your account will be frozen, your package will be lost, or that urge you to pay first. You can use AI tools like ChatGPT to make a preliminary judgment on the authenticity of an email (I once used ChatGPT to verify a DMV email). Remember, nothing is that urgent. Take a deep breath, think calmly, and don’t part with your money easily. When people are eager to do something (like get rich), they are more likely to be scammed. I myself had an experience in high school with a summer job scam that cost me 300 TWD; I paid the fee and the person disappeared.

IV. Highlights / Key Quotes

#

The market is truly unrelated to international situations, financial reports, or the economy. Whether interest rates are cut or not doesn’t matter, it’s all fine, it has nothing to do with us. It all has nothing to do with me. – Teacher James

This viewpoint, woven throughout the session, emphasizes the transcendent mindset an investor should have, focusing on their own investment discipline and not being distracted by external noise.

The market will definitely go up, the market will definitely reach new highs. Investing requires patience, and wealth is worth the trouble. – Teacher James

This articulates a firm belief in the long-term trend of the market and the character required for successful investing—patience.

I might be wrong. I might be wrong. I might be wrong. – Teacher James (quoting from the book “I Might Be Wrong”)

When facing disagreements or strong emotions, engaging in self-reflection first can help resolve conflicts and enhance cognition and inner peace.

Hold stocks in your hand, but not their prices in your heart. You only need to spend five minutes a year on it. – Teacher James

This describes the ideal state of investing: holding quality assets without being disturbed by short-term price fluctuations, emphasizing the simplicity and passive nature of investing.

Boredom is the highest state of investing. If you feel it’s exciting, then you’re speculating, you’re gambling. – Teacher James

This reveals the true nature of long-term value investing, drawing a clear line between it and the thrill-seeking behavior of speculation.

If you can handle something, face it and get it done. If you can’t handle it, then forget about it, as it’s not within your capability. – Teacher James

This offers a philosophical attitude for dealing with various problems in life and investing, reducing unnecessary worries.

Absolutely do not sell your QQQ, sell your 00662, during a downturn. You can choose not to buy, but you must never sell. – Teacher James

This emphasizes that one should not panic-sell core quality assets during a market correction, a common mistake among investors.

Don’t leave (your current job) because your salary is low, and don’t jump to another just because its salary is high. – Teacher James (commenting on Brian’s sharing)

This highlights that in career choices, personal happiness and the growth environment are more important than short-term salary.

Your cash must be able to last you 15 years (during a market downturn). This is a critical key. – Teacher James (on asset allocation for retirees)

This points out the importance of having cash reserves in retirement planning that can cover a long bear market (which could last up to 15 years before the market doubles).

Happiness is a human right. Therefore, you shouldn’t accept anything that makes you unhappy. – Teacher James (commenting on Brian’s sharing)

This encourages people to prioritize inner happiness and harmony in their work and life, and to have the courage to change unhappy situations.

V. Summary

#

In this sharing session, Teacher James once again reinforced the core philosophy of long-term investing: maintain optimism, adhere to discipline, and filter out market noise with the wisdom of “it has nothing to do with me.” By recommending “I Might Be Wrong” and “Life is Worthwhile,” he guided students to cultivate their inner selves, focus on breathing and relaxation, and achieve harmony in both investing and life. In terms of asset allocation, the teacher detailed cash management strategies for different life stages, especially the importance of having 15 years of living expenses for retirees to safely navigate market cycles, and gave clear guidance on pledging, leverage, and Beta control. The Q&A session delved into specific cases, addressing students’ confusion in practical operations, such as portfolio adjustments after large cash withdrawals, tax considerations for overseas investments, the wisdom of career choices, and preventing financial scams like direct selling. The teacher encouraged students to work and live in a relaxed, stress-free state, to simplify investing, and ultimately achieve financial freedom and life happiness. He emphasized investing in index funds like QQQ/00662 and avoiding annuities and unnecessary insurance.