It is a very simple idea to use the power of compound interest

It is a very simple idea to use the power of compound interest  Smart people are easily attracted by complex things, and underestimate the great influence and importance of simple ideas. But Monish Pabrai is a full pragmatist, and he will not fall into this trap. "It is a very simple idea to use the power of compound interest, a very simple idea to imitate, and a very simple idea to be honest." He said. However, when you apply some powerful ideas with great enthusiasm, the cumulative effect is "incomparable".

Impossible Triangle in investment

Impossible Triangle in investment

 In the investment, the extremely high yield, extremely low risk, and extremely strong sustainability constitute an "Impossible Triangle". Most people spend their lives chasing the first, which usually leads to an uncertain result at the cost of definitely destroying the second and third. In fact, there are many uncontrollable elements of luck in Article 1. The combination of Article 2 and Article 3 is the foundation of compound interest and can be actively grasped from the perspective of the system. What's more, doing well in these two articles will not hinder the arrival of luck. Understanding the connotation of this impossible triangle can improve the probability of successful investment.

To some extent, we are all trend investors. The top-level trend is called the times, the lower level trend is the economic cycle, and the lower level is the company's business rhythm. It is a real big opportunity to find the resonance point between the three. It is a great pity that the times are up but are delayed by the downward industry cycle or basically bad-oriented companies. It needs vision and luck to catch big opportunities, and it needs reason and common sense to avoid big regrets in good times. The core of company research is space, structure, depth, and angle; The core of the trading strategy is the probability, odds, and expected difference; The core of the investment system is the object, timing, and strength; The most essential core of investment is value, safety margin, and compound interest.


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