Charming Talk #19 "3 Things You Need to Know Before Cross-Field Investment" Why U.S. stocks, virtual currencies, and REITS make me fall in love

Invited by the Podcast program Charming Talk, to share the 3 best things to know before investing in cross-sectors, click the link below to listen, and provide the following transcript

https://anchor.fm/stellasu/episodes/193REITS-e12cr0s

1. If you find that the investment market in the emerging field is very profitable, how do you enter the investment field that you are not familiar with? What kind of mental preparation and practical preparation do you think you need in advance? What is the recommended way to study systematically?

divided into two parts

Psychological preparation: Know what kind of person you are? Can you accept high risk? Or a risk averse? There is no right or wrong, it is purely your tolerance for unknown risks. Exploring the investment market in emerging areas will have a strong psychological quality. You are not defeated in the unknown, and you can still keep the fun of being curious about everything. But if you are more risk-averse if you join the currency circle, you can also choose to live or pledge as pure USDT. If you are a savvy person, or you are used to the short-term play of the mad dog in the traditional financial market, then you can continue to train your heart when you come to the currency circle.

Substantial preparation: I personally know the basic background knowledge first when entering an unfamiliar field, and then study a lot of relevant materials. The cryptocurrency part is really one minute in the currency circle, ten years in the world, this sentence Not only refers to the high volatility profit and loss characteristics, but also refers to the explosion of information content in the currency circle. The information content is growing in an exponential way, and more information is often published just after reading the white paper. For people, blockchain is a generational opportunity

In the investment and financial management part of traditional finance, I pursue the simplicity of the road, that is, the lazy and minimalist style. After I read the investment golden rule and the blog of my predecessor Green Corner, most of my assets are invested in the large-cap ETF ( For example, VT/BND/VNQ), I don't usually look at the market. I only occasionally study a few stocks related to my industry and ETFs that I am interested in.

What is the recommended way to study systematically?

I personally understand the basic background knowledge and read a lot at the beginning, (you can refer to my meduim book list, not limited to investment classic books, even I can read currency history), and take the right class (it is not easy to take the right class these days , find the correct source of information), usually I also like to watch financial-related American dramas (such as billions)

When you read or acquire more knowledge, you can condense your own investment principles, and then actually implement them. After implementation, you will gradually revise your own methods and find your own investment principles.

In investment, you have to have the principal, you can read a lot while you deposit the principal again, and it also has the effect of compound interest of knowledge

2. Asset allocation: You invest in many different fields, how do you do "asset allocation that suits you", can you share your worst and best experience in risk control?

In the past, my personal asset allocation was: 70% large-cap ETFs / 20% large-cap bonds / 10% reits or individual stocks

After starting serious entry into the cryptocurrency market last year, I adjusted my allocation to 50% large cap ETF/20% crypto/20% large cap bond ETF, 10% reits or individual stocks

The worst experience in risk control is because last year, because the market situation was too good, and I was a little greedy, so I adjusted my allocation and made a short-term rush in the part of US stocks. Although I made a small profit, I feel that my risk control is not good. Maintaining their existing principles, they are mentally in a state of impetuousness. In fact, this year, the entire market has returned to its usual level from the first half of the year.

The best experience, I personally hold most of the index ETFs in 2020. Fortunately, the market has continued to rise in the past ten years. Just last year, the position that followed the market saw a 15% increase in assets.

The road to simplicity/return to the industry/pursuit of simplicity, investing in index investment has become one of the principles of this life. I think it is the best experience

3. What are the differences between these three investment fields (US stocks, cryptocurrency, REITS) in your observation, and what are the risks and advantages for beginners?

• U.S. stocks: If you have the opportunity to try it, you are encouraged to directly open overseas securities companies to invest in U.S. stocks (FT/TD)

It is undeniable that this is a mature financial market, and you can buy ETFs in various industries (you can choose Auntie Wood's active ETFs and you can buy index ETFs that track S&P 500)

For beginners, assets can be allocated according to their own risk-sharing attributes. As the old saying goes, according to their own risks and advantages

• Cryptocurrency: a piece of emerging finance, coupled with the current development of Defi, I am quite optimistic about the application of this piece, both public and private.

Use, for beginners, you can directly buy cryptocurrency holdings through Taiwan maicoin or currency trust, regular fixed amount, I personally buy cryptocurrency directly with Binance, you can buy it with a credit card (you can choose a foreign currency with high reward) , just like buying things in AMAZON, you can also get high rewards by brushing foreign currency

Novices recommend that after buying cryptocurrencies, they can be pledged or set to survive, & USDC's survival rate is 7% per annum. USD Taiwan foreign currency fixed deposit will not exceed 2% at most what a new world!

• REITS:

The full English name of REITs is "Real Estate Investment Trust", which means real estate investment trust fund.

It is a commodity that can be traded in the stock market. In short, it is the securitization of real estate, allowing you to invest in real estate (real estate) with a small amount of capital. Investing in REITs is like you own a part of the real estate. If a real estate costs $60 million, and you own "1/60 million" of it, it feels like "you own a small tile in the toilet in that real estate." Same.

The cash flow of REITs mainly comes from rental income, maintenance and management fees, occupancy rates, etc., and you must know that the rental of REITs is not "renting to households to collect rent" as you imagine. On the contrary, there are many cases of REITs that are rented to commercial offices, data centers, industrial land, hospitals, etc., and even land rental, equipment on buildings, etc. can be regarded as one of the projects, and renting a house as you imagined should be a little bit. different.

So basically the cash flow of REITs is very stable when the tenant does not default.

In addition, REITs in the United States are stipulated that more than 90% of their profits must be distributed to shareholders as dividends. I myself hold the two Reits of VNQ & O.

4. Conclusion: Some advice or words of encouragement for beginners who want to enter the emerging field~

Under the epidemic, I have more time to calm down and learn about investment and financial management. During this period, I can read widely, ask seniors in various fields, build my own knowledge system, strengthen my mind, and let myself be in investment or investment. progress in life