Withstand risks and move forward calmly

Yesterday, I expressed myself incorrectly at the end of the article. What I meant to convey is:

If the main positions are in Bitcoin and Ethereum, even if Bitcoin and Ethereum were bought at high prices of $73,000 and $3,400, the positions would not have such significant paper losses.

(Of course, I am not suggesting that everyone disregard risks when buying Bitcoin and Ethereum at high prices.)

The main reason why buying Bitcoin and Ethereum can have such an effect is that they have a high safety factor—this is a very important consideration for investors.

I have repeatedly written in my previous articles: For the vast majority of investors, achieving satisfactory returns in the market often requires avoiding one risk after another and steering clear of one pitfall after another, which is often more important than seizing so-called "get-rich-quick" opportunities.

This recent sharp decline is a pitfall: if derivatives are used but the direction is wrong, it can wipe out investors overnight. If the hard-earned money is invested in the wrong assets, it could lead to a total loss, with no chance of recovery.

In addition to investing significant positions in high-safety assets, another important point is: the price at which assets are bought should also be controlled at a relatively safe level—this can provide us with a sufficiently strong "safety cushion" when unexpected events occur.

Yesterday, I saw a comment from a prominent figure on Twitter. He stated emphatically: "No one is not losing in this sharp decline; the market will improve in the future, so everyone shouldn't lose heart."

I completely agree and recognize the encouraging part of his statement about the future market, but the assertion that "no one is not losing in this sharp decline" is too absolute.

In fact, if operated through a systematic investment approach and the investment price is set reasonably, how could there be losses?

I set my systematic investment price for Bitcoin at $35,000 and for Ethereum at $2,500. By sticking to this method, the average cost will definitely be lower than $35,000 and $2,500.

By maintaining such systematic investment prices, even when encountering this sharp decline, we still have paper profits.

Of course, I don't care about this meaningless paper profit because I won't cash out at this price level. I firmly believe that the future bull market will bring us truly substantial returns.

Last month, I watched a recent interview video with Lin Yuan. In that interview, the interviewer asked him about his views on the current U.S. stock market.

At that time, the U.S. stock market was still thriving and prosperous. The interviewer's tone was clearly optimistic, and there was a hint of hope that Lin Yuan could encourage investors entering the U.S. stock market.

However, Lin Yuan's response was quite interesting. He said he stopped investing in U.S. stocks in 2015 and has just been holding; as for whether the market is up or down now, he doesn't care at all.

I roughly checked the annual trend of the S&P 500, and in 2015, the S&P 500 was around 2,100 points, while now it is already at 5,200 points, an increase of about 2.5 times.

With the chips acquired at such a low price, even encountering the recent sharp decline is just a small ripple for him; it won't affect his fundamentals at all, nor will it impact his emotions and mindset.

Therefore, he can completely ignore one shocking "crash" after another, which to him is merely fleeting noise.

In these past few days, after experiencing the sharp decline in the U.S. stock market and the cryptocurrency market, I have come to appreciate even more the importance of risk resistance and safety for investors.

When the storm strikes, while others are terrified and anxious, those who calmly face the wind and proceed with composure are the ultimate winners.