In trading, being right or wrong does not matter. Both fundamental and technical methods can be used. The key is how much money we make on each trade when we are right and how much we lose when we are wrong…
![[Golden Investment Rules] 5 Pieces of Advice from George Soros, the Master Investment Wizard Who Works in Silence](https://cafebiz.cafebizcdn.vn/thumb_w/600/2018/8/5/photo1533452288339-1533452288339667275848.jpg)
George Soros is one of the most successful investors of all time. He began buying stocks at 25 and achieved extraordinary results in less than the next 10. Around that period, after working in securities trading, he founded Soros financial management company with USD 17 million in capital.
Three years later, he had increased his budget to 100 million USD. In 1992, he made a large profit from the fall of the British pound, earning as much as 1 billion USD in just one week. Similarly, during the 1997 Asian financial crisis, Soros earned billions of dollars through short selling.
He is also the owner of the Soros Quantum Fund, renowned in global financial markets for average returns of 30%–50% during his leadership. George Soros is also among the world's most generous philanthropists.
Soros’s philosophy is distinctive: “In investing, being right or wrong is not what matters; what matters is how much money you make when right and how much you lose when wrong.” He also says experience and daring are among the most important factors in becoming a successful investor. Below are 5 tips drawn from the 88-year-old billionaire’s experience for public investors seeking success, from an interview on CNN’s financial news.
1. In Investing, Work Quietly
Investing means each individual is trading with an entire large market, so there is no need to show off your portfolio. Learn to keep your activities private and learn from past mistakes instead of repeating them.
2. Choose the right trend to invest in
Investors sometimes wonder why stock prices fall after they select the best companies to invest in. In the author's view, buying shares in a good company is not enough; another important factor is ‘choosing the right timing.’
Technical analysis using statistical charts of stock index movements over 50 to 150 trading sessions can help investors identify trends. Suppose the blue line on a chart represents movements over 50 trading sessions, while the green line shows 150 sessions. When the blue line is above the green line, the market is in an upward trend, and vice versa.
Investors can create these charts using available software simply by entering figures. Whether compiling statistics manually or using software, try to recognize the principle in time: ‘Always buy shares in an upward trend and sell immediately when you recognize a downturn.’
3. Be decisive in every investment decision, whether buying or selling
Some investors often struggle to decide whether to buy or sell. They hesitate and cannot think independently. They feel uncertain simply because they do not understand what they are doing. They have no plans or guiding principles in place. Most investors are unwilling to observe stock market movements objectively.
They always do their own analysis and make their own decisions, but also tend to rely on subjective opinions in the market. This leads to hesitation, leaving investors confused about which decision to make. By the time they decide, it is too late: they suffer losses because they did not sell falling stocks in time, or miss profit opportunities because they did not buy growth stocks early enough.
The lesson is that investors need to be decisive in their investment decisions. This is an essential quality when participating in the stock market.
4. Ignore rumors
Information seems to require especially careful risk management because the stock market tends to be overwhelmed by it. Information may come from word of mouth, social media, or stock market forums… It would be somewhat excessive to say that most information from these sources is unnecessary and does not really help investment activities. In many cases, however, it is even counterproductive, creating noise and causing losses if investors use it without thorough investigation.
Soros believes one way to lose money in the stock market is to focus on rumors and unofficial sources, fail to check them carefully, and rush into decisions—the fastest route to failure. To succeed, he advises small investors like us to ignore outside opinions and predictions and try to follow our own predetermined strategies.
5. Do not learn to predict; learn to respond and adapt swiftly
For Soros, financial markets in general and stock markets in particular are inherently unpredictable. You must therefore always have multiple scenarios… In the stock market, reality often unfolds contrary to your predictions. He advises individual investors to learn to react quickly rather than forecast. Develop multiple scenarios and prepare a response plan for each.
Collected.
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