From asset allocation to wealth inheritance, 10 financial rules for Chinese friends

When some markets rise, others fall, reflecting different economic conditions. By balancing these investments, you can reduce the cyclical fluctuations of your portfolio, thereby achieving good returns while lowering risk.

In the long run, cash is a very poor investment. The challenge China faces is that investors tend to hold large amounts of funds in real estate or cash deposits, which is not a good diversified portfolio.

The return of any asset usually consists of two parts: price change and income. When an asset’s income mainly depends on price appreciation rather than coupons, caution should be exercised.

Investors need to regularly rebalance their portfolios. If there is no clear market view, a simple rebalancing strategy can be adopted: when the price of a certain asset class rises, reduce some positions in a timely manner, and transfer funds to other asset classes to maintain long-term portfolio balance.

Any time is a good time to diversify investments, but individuals and investors must be very cautious when trying to time the market.

Diversification and risk balancing are important means to enhance returns and reduce risks.

Do not try to predict market trends; market timing is essentially a zero-sum game.

Do not look at the components of your portfolio in isolation, but consider how they work together to form a well-diversified investment portfolio.

Debt is currency, and currency is debt.

Gold is the second-largest reserve currency, the first is the US dollar, the second is gold, the third is the euro, and the fourth is the Japanese yen.

Gold is more attractive to me. However, I still hold some Bitcoin as an alternative choice.

Stablecoins have significant advantages in trading, especially appreciated by those who pay less attention to interest rates; they are willing to give up interest for the convenience of trading. But stablecoins are not a good store of wealth.

Inflation-indexed bonds are an excellent tool for storing funds. They can provide compensation based on inflation rates while also offering a certain real interest rate. This type of asset has low risk and is an ideal investment choice.

Everyone needs to recognize the importance of savings. Savings provide you with a foundation and security, and this sense of security gives you freedom.

Ensuring the basic financial security of individuals and families is crucial. To achieve this, it is very important to learn investment knowledge and to allocate assets reasonably.

Only after ensuring a basic standard of living can you consider taking on more risk and trying to earn higher returns.

Every birthday and Christmas, I give my children a gold coin. I tell them, you cannot sell this gold coin. You can only pass it on to the next generation on the day the monetary system collapses.