These are some notes from my personal investment in the stock market, not considered as financial investment advice, for reference only.

A few years ago, I lost over five figures of money in the stock market. Although the amount was not large, as a novice investor, I invested this money in a volatile technology company.

Compared to now, I was very foolish back then, but now I should be better, at least I hope so.

Anyway, this experience shocked me greatly. Since then, I have avoided the stock market, but I am still plagued by the painful regrets it once gave me.

But recently, in the context of the emergence of COVID-19, all the buzz about "Robin Hood traders" defeating billionaire investors aroused my interest in the stock market again.

So in April, I once again immersed myself in the world of stocks. But this time, I didn't immediately invest my wealth like a fool, but remained in learning mode. I have invested over 100 hours in videos and books created by millionaires and millionaires.

Good news: I have found that in order to achieve the goal of making money, there is only one strategy that people need to know, and it follows a simple philosophy that everyone can understand.

If someone is in a wait-and-see state because they don't like numbers and charts, then I will demonstrate a high profit method that requires minimal technical analysis and is recognized by Buffett. To understand the working principle of this method, we first need to understand its basic rules.

Basic principles

Ultimately, the market always rises

The most important thing I have learned so far is that from a perspective beyond time, the market trend is always upward.

The chart above shows the performance of the S&P 500 over the past 90 years. The S&P 500 index is used to track the performance of the Fortune 500 companies in the United States and is typically used as an indicator to measure the overall health of the stock market. It is evident that despite occasional declines caused by recession, the overall trend is an increase in market value.

Note: Distinguishing market conditions from individual stocks is crucial, and this chart has no meaning for individual stocks. You should know that companies like Facebook, Apple, and even Google may go bankrupt.

2. Do not try to seize the opportunity

The second lesson I learned is that for most retail investors, it is almost impossible not to try to predict the market's upward or downward trend in the short term.

Even if people can obtain seemingly valuable insights from relevant news, earnings reports, and analytical tools, unless there is a professional research team that can uncover behind the scenes information about government agencies and corporate executives, the likelihood of people making incorrect predictions will far outweigh the likelihood of being correct.

This means that retail investors should stay away from short-term investments, as it is highly likely to end in tears.

Even experts often make incorrect judgments

Mastering all technical chart strategies and obtaining behind the scenes information does not necessarily mean that people can gain profits.

According to investopedia.com, a study by Credit Suisse showed that from January 1994 to October 2018, the S&P 500 index outperformed all major hedge funds' game plans by 2.25%.

This does not mean that there are no investors who regularly outperform the market. But overall, this indicates that the stock market is so unpredictable that experts find it difficult to determine their own investments.

The only strategy people need

So what is the final conclusion? Should people give up or transfer their property elsewhere?

Let's first summarize the information we have gathered:

       1. In the end, the market always rises

       2. Don't try to seize the opportunity

       3. Even experts often make incorrect judgments

Follow Index Fund

Index funds are a portfolio of stocks invested in the entire market. When people buy a stock index, they are actually buying stocks in the US market, not just stocks of one company. This can help investors stay in line with the market tone, which has generated an annualized return of approximately 10% over the years.

Why do we have to do this?

Looking back at our first suggestion: Ultimately, the market always rises. This means that people do not have to spend money to study the rise and fall of specific stocks, but only need to invest in index funds.

In recent analysis data, a writer named Motley Fool concluded that if someone had invested $10000 in an index fund in 1980, its value would have reached $760000 by February 2018.

This strategy is entirely based on long-term returns, so the idea of overnight wealth can be said to be completely rejected.

It is worth mentioning that Warren Buffett constructed his own will, resulting in 90% of his wealth flowing into index funds after his death.

Invest according to the schedule

Review the second and third suggestions: Do not attempt to seize market opportunities, as experts often make misjudgments. This means that the best investment rhythm should be to follow a schedule, rather than waiting for the market to fall in order to buy at a low price.

Every month, a portion of the salary is invested in index funds, so that sometimes purchases are made when the market is at its peak, and sometimes it is seized when the market is at a low level.

However, this is not important because it is a long-term investment, not the next few days, weeks, or months. It doesn't matter whether the value of the fund decreases the next day, because we know it will rise in the next few decades.

Therefore, this is the entire strategy: deposit money into the index fund every month and then forget about it. In another 20 years, a large amount of profits will be obtained.

Surprisingly easy

Does this alleviate people's burden? At least useful to me. As someone who is born not to shrink numbers or read charts, this strategy is very simple.

With this mindset, I don't have to worry when the media is concerned about people speculating about the health of the economy or about Facebook's upcoming earnings report. As long as society doesn't collapse, I will make money in the long run.