Recently, some friends often ask me the following questions: "I have relatively few positions now, what should I do now?" "I am still short. Facing the hot market, should I buy some?" "I also want to enter the stock market and earn some living expenses. Do you have

What suggestions”.

I didn’t dare to respond to these questions in time because I have been busy with work recently and have no time to think carefully and systematically. Of course, there are other reasons (mentioned below).

Taking advantage of the weekend, I first took stock of the stocks I held. The purpose was not only to overcome some of the anxiety in my heart, so that I could concentrate on thinking about some issues, but also to insert myself into it and better serve the future.

Others offer advice.

In fact, a one-by-one inventory of stocks held over the weekend is just an evaluation and correction of investment behavior from the fourth quarter of 2018 to the beginning of 2019. Therefore, there will be no changes in holding objects, holding positions, and shareholding structures in the future.

A major adjustment, unless there is an extreme situation next, such as a sudden rise or fall.

Overall, I am quite satisfied with the existing shareholding objects and shareholding structure.

From the perspective of holding objects, starting from the fourth quarter of last year, my investment method changed from format value investing to Pakistani value investing (I did not completely abandon format value, but replaced it with some index funds). The first reason is that I am too busy at work.

Taking stocks into consideration, secondly, it is easier, more secure and more efficient to invest in excellent stocks; thirdly, during that time period, you can buy Pakistani stocks at the pattern price, and there is a high probability of achieving a Davis double-click.

From the perspective of holding structure, stock positions are more focused, and the correlation between stocks and funds has become smaller, taking into account defensive and offensive stocks, domestic stocks and foreign stocks, value stocks and growth stocks.

Of course, this does prevent risks, but it will inevitably reduce returns.

I accept this result. After all, my experience in Pakistani value investing is still relatively short, and I have not fully figured out some aspects. It is necessary to take some appropriate precautions.

However, my focus in the previous stage is: 1. What should I do if the stock I hold rises sharply, falls sharply, or remains unchanged based on the existing price?

2. I will receive a new amount of funds at the end of March, what will I do then?

After thinking about it for a long time, I suddenly found that I had complicated the problem, or that I had deviated from the basic principles of value investing.

In fact, no matter what the situation is, as a value investor, when facing any market changes, you should adhere to this principle: when in doubt, directly compare the difference between price and value, indirectly compare the values ??of different stocks, and then make a decision based on

Compare the results to make a decision.

If the future price is much higher than the intrinsic value of the stock held, of course, sell all of it; if it is about the same and there are better investment objects, you can sell a small part appropriately; if it is far lower than the value, of course, continue to hold it.

The same applies to the use of new funds.

This simplified way of thinking made me more confident and prepared for future operations, but the process of reaching this conclusion made me sweat profusely.

Why am I still struggling with questions like "What should I do if prices change differently in the future, and what should I do with new funds?" This shows that I have not fully implemented the concept of value investing in my investment practice, and I need to think deeply before I can remember to use value and price.

The gap is used as a yardstick to determine future investment behavior.

The difference is that when faced with this situation, excellent and mature value investors can make quick judgments or respond to such market changes indifferently, because they always have an internal scorecard in their minds and always keep the principles of value investing in mind.

The basic principle.

Fortunately, this reflection gave me a deeper understanding of value investing, which enabled me to always remain rational, follow rules, and respond quickly when faced with similar situations in the future. I also adhered to the basic concepts of value investing and abided by the sales

The three major standards proposed can also reduce hesitation and indecision.

From this, I thought of the story of remedying the situation when I was young.

This story tells us that firstly, we should not take chances with mistakes and take it for granted that mistakes are just accidents and will not happen again; secondly, when we know that we have made a mistake, we should correct it immediately and do not make the same mistake again and again, so as to prevent bigger mistakes.

loss.

I still agree with this conclusion.

However, as an excellent investor, we should take a step further and do more things to prepare for a rainy day (in this way, we will be more proactive and respond more fully), and do less to make up for the situation before it is too late (more passive, losses have already occurred, and the cost is also high,

Even if the remedy is effective, the benefits will be greatly reduced) and we will never do anything that we will never regret. Only in this way can we do better, take greater initiative, and better deal with future risks. After all, we must anticipate the enemy and win.

Calculate victory first and seek battle later.

How to say.

If you are currently a short or light investor, you should think about why you bought from the end of 2018 to the beginning of 2019?

You should carefully recall and review what factors led to your decision to take a short or light position at that time?

Are these factors reasonable (not necessarily unreasonable, such as lack of spare funds or experience at the time)?

What should you do when faced with these situations in the future?

Only by repeatedly questioning yourself in this way can your personal investment level improve.

Of course, this does not mean that it is not important to make amends.