Investment returns = Cognitive monetization.
Our main goal is to achieve cognitive arbitrage.
In financial markets, early returns come from "information asymmetry" (I know information that you don't),
but with the development of the internet and Web3, information asymmetry is being leveled. The excess returns (Alpha) of modern investments come almost entirely from "cognitive differences" (with the same information, I can interpret trends that you cannot understand).
So how can we enhance our cognition? There are only two ways.
1. Rare life experiences (like Duan Yongping's experience in business):
This is obtained at the cost of "real money," which is extremely high and non-replicable.
2. Reading: This is the only feasible shortcut for ordinary people.
Personally, I believe reading is a low-cost simulation of life.
Reading history (such as "The Fifteenth Year of Wanli," "Southward Migration, Northward Return"):
is for rehearsing cycles. If you know the patterns of currency collapse in history, you will have a different perspective when looking at cryptocurrencies.
Reading philosophy/biographies (such as "Su Shimin," "Duan Yongping"):
is to borrow the decision-making models of prominent figures.
Most importantly, it is to internalize others' experiences from books into your own intuition.
Many people read a lot of books but lack wisdom, which is precisely what is missing.
Knowledge does not equal wisdom.
Reading does not equal extracting, nor does it equal executing.
1. It is too difficult to unify execution.
Many people have read "Do Projects Like Investing" (they have gained cognition), but still panic sell during market crashes (failure of emotional control).
2. The ability to explore the underlying essence and laws.
Ordinary people read: remember that Duan Yongping bought NetEase and made 100 times (this is the story).
Experts read: extract Duan Yongping's decision-making model—
"Buy companies with blood-generating capabilities and healthy balance sheets during extremely pessimistic moments of mispricing" (this is the law). $hype
When reading, it is essential to pay attention to what are consistently effective rules. For example, the weaknesses of human nature.
And which ones often fail?
Like quantitative or valuation indicators.
Stories may fade away, but human nature remains unchanged.
