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I have always dreamed of becoming a stock trader. When I was a child, I found it fascinating to watch family members glued to the television, watching stock market analysis shows. At the age of eight, I asked curiously, "Can you make money from this?" The answer was, "Yes, you can make a lot of money." So I declared, "I want to do this." From that moment, I developed a keen interest in stocks. When I was twelve, my parents actually took me to Wall Street, where I visited the New York Stock Exchange and even took photos with the famous Charging Bull. I thought, "This is where I will work in the future." However, I later discovered a more interesting way to make money and dove headfirst into the world of Texas Hold'em poker.
On the path to becoming a professional poker player, I experienced setbacks and bankruptcy, which made me contemplate giving up my dream. During my third year of college, I lost 2 million in just half an hour. That last time I went broke, I went to a bookstore, bought a stack of books on stocks, and started studying in an attempt to reconnect with my childhood aspiration. Although I eventually returned to poker, my interest in stock investments continued. I would invest whenever I had spare money, buying 50,000 or 100,000 shares. As the number of stocks in my portfolio grew, I became more sensitive to price fluctuations. A single decision could involve hundreds of thousands or even millions of dollars, much like playing cards. So, I started actively researching stocks again.
Stocks and poker are similar in the sense that they require a clear assessment of the value of each asset. Just as everyone knows that in Texas Hold'em, a pair of Aces (AA) has the highest initial value, but its value fluctuates as community cards are revealed and opponents act. To succeed, you must adapt your perception of the "value" of your current hand based on these factors. Stocks are also similar; you need to find promising assets, determine their intrinsic value, and buy when the price is below that value and sell when it's above it. You should not worry about daily price fluctuations, as they do not fundamentally affect the intrinsic value of the stock.
However, there's a key difference between stocks and poker. In poker, the difficulty increases linearly with the stakes, meaning that higher-stakes games are more challenging. In contrast, with stocks, the difficulty level doesn't vary significantly based on the amount invested. Furthermore, the stock market is filled with many inexperienced and speculative investors who watch stock prices daily and make decisions based on gut feelings.
Warren Buffett once likened the stock market to a pitching machine that throws balls at you every day. In this baseball game, there are no strikeouts, no limits on attempts, and not swinging the bat won't result in an out. You can wait until the right pitch comes and only hit when the price is correct. But don't dwell on past prices; focus on the current value.
I once tried to find the perfect investment secret, stock market techniques, and took many courses on stock investments. I studied Warren Buffett's investment philosophy meticulously. However, I found that, just like in poker, there are no secrets—only the need to find good companies and calculate their intrinsic value. You buy when the price is below the intrinsic value and hold for the long term, becoming a shareholder, earning from dividends, waiting for the power of compound interest to work for you. The principle is straightforward, but the most challenging part is execution. Many people have unrealistic fantasies.
I researched the Taiwan stock market and found that a traditional industry stock, Yi Feng Curtain (stock symbol: 8464), was performing exceptionally well with beautiful reports and steady profits. I told a friend about this stock when it was priced at 250 NT dollars, and he asked, "Why are you picking stocks like these? Where did you find it?" He decided not to buy it as he considered it too expensive. Later, the stock started hitting its daily limit for several days in a row, and my friend, who was a fan of surging stocks, was eager to get in. I had calculated a reasonable entry point between 200 and 220 NT dollars and advised him to wait. He didn't take my advice seriously and said, "But this stock used to be over 400 NT dollars; it still has a long way to go to reach its historical high." |
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Post time 9-11-2023 10:50:14