Have you really thought about whether you should active invest or passive invest?
Here is a thread on active vs passive investing that might spike some of your thoughts 👇👇
What are active and passive investing?
Active investing refers to you picking your own investments (stocks, bonds, gold, currencies etc.) or you paying a professional to do the work for you.
Passive investing means you buy an index fund regularly for a long duration.
What are the goals of active and passive investing?
Active investing = beat the market 👊
Passive investing = obtains returns that equal the market returns 🤝
Benefits of active investing
✅ Potentially beating the market
✅ Greater flexibility
✅ Better for niche markets
✅ More fun & interesting
Downside of active investing
❌ Potentially losing to the market
❌ More risks & pressure
❌ You may be wasting your time
❌ It is hard to beat the market
❌ Requires skills & patience
❌ Higher fees & taxes (if you trade frequently)
Benefits of passive investing
✅ No need to research
✅ Good transparency
✅ Steady returns
✅ Easy
✅ Lower fees & Tax efficiency
✅ Less pressure
✅ You get what the market returns
Downside of passive investing
❌ You cannot beat the market
❌ Can be boring at times
As we can see, there are actually many benefits of passive investing, and rather limited downsides. You DO NOT need to force yourself to pick stocks & funds if you don't want or feels like you are not good at it.
Passive investing is a great strategy for most people. I would say unless you love to research and are more risks loving, it would probably be wise to passive invest.
Active investing on the other hand, is based on the single greatest advantage - 'potentially' beating the market.
Therefore, if you have invested for 10-20 years + and has beaten the market, its a good idea to active invest, otherwise, passive invest may be the better way
According to Morningstar, only 24% of all active funds beat the average of their rival index funds in the decade ended June 2020. Beating the market over the long run can be hard even for professionals.
Therefore, you really need to think about the merits for active investing, if you are in only for the money, instead of you enjoying the investing process and having fun.
As @AswathDamodaran has said, if you spent tremendous time & effort into active investing, but at the end of the your life, someone tells you, you underperformed the index, and if you are still ok with that, then consider active investing. Otherwise passive is the way to go.
I am not in anyways saying that active investing is bad, but I just want spark some thoughts and have you thoroughly asks yourself, is active investing really better for you?
Do you active invest or passive invest? Why do you active/passive invest?
Let me know! 👇👇
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Recently, many people have asked me why I am still interested/or invested in $BABA, $TCEHY, $JD, $NIO and any Chinese stocks. Why not sell?
Here's why 👇
Firstly, I am a Chinese, and I think I inherently have an edge when looking at Chinese companies because of the Chinese language. I have been following the Chinese government for a while too.
Therefore, I am willing to take some educated bets.
Secondly, these companies are all great companies IMO. They have strong fundamentals, and if the biggest risks is the government cracking them down, I am happy to live with that. They are (somewhat) discounted too btw.
I have tried learning with $COUR for the past month for coding, here are some thoughts on the experience.
By paying $59 USD per month for Coursera Plus, you get access to many different courses offered by famous universities around the world. Most courses are well design packed with a lot of content.
The course I took was Python for Everybody, which is a pretty interesting course. The content is great and the lecturer is very engaging.
Palantir build the digital infrastructure for data driven operations and decision making. $PLTR seeks to become the next industry default software. In this thread, I will go over the things that you need to know about $PLTR.
Let's get started!! 👇👇
Total Addressable Market
$PLTR in S1 estimates its total addressable market to be approximately 56 billion for commercial operations and 63 billion for government side, a total of 119 billion. Most businesses that use data are $PLTR's potential customers.
Problem
There has been more data than ever before. However, many organisations do not have an integrated data system to manage their data. Therefore, the data is there, but it cannot be effectively used.
Tencent $TCEHY is arguably the most dominant Chinese tech company that have ever existed.
This thread will go through the lessons that I have learned from reading book, the story of Tencent.
Let’s get started 👇👇
1. Extreme minimalistic
$TCEHY always strives for minimalistic for their app design. The logic is to make an app simple enough that people don’t need to think. WeChat is exactly that.
2. Customer experience
$TCEHY and Pony Ma, Tencent’s founder, have always hammered on customer experience. Pony suggests that product designer should use their product daily, go on to forum for reviews to improve their product.