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in the five trading days before the national day, the shanghai composite index rose sharply by more than 500 points, reaching 3,300 points again, quickly recovering the lost ground in the past year.

what kind of investor will not miss this rising market and repeatedly have "good tricks" in long-term investment?

john templeton was hailed by the media as "one of the greatest stock investors of the 20th century." he hit the bottom of the u.s. stock market in september 1939 and tripled his profit in the next four years. if an investor had invested us$10,000 when templeton founded the fund in 1954, it would have grown to us$2 million by the time templeton retired in 1992, with an annualized rate of return of 14.5%, outperforming the market by an average of 3.7%.

when summarizing his investment experience, templeton said that the main elements of luck are hard work and careful planning, as well as common sense and imagination. luck belongs to those who "work a little harder". luck means that you do not hesitate. enduring hardships and hardships means that you work hard into the long nights, and it also means that you never miss an appointment or miss a train.

create your own luck

templeton hit the bottom of the u.s. stock market in september 1939. at that time, the stock prices of more than 100 companies fell below $1 on new york and other u.s. stock exchanges. templeton, who was only 26 years old at the time, borrowed money from his boss. i bought $10,000 of each stock for $100.

about four years later, templeton sold all his shares, and his original $10,000 principal had increased to $40,000.

however, this would be chalked up to luck by most people. but in fact, templeton's generosity came from hard work and careful planning.

as early as two years ago, templeton had conducted a comprehensive analysis and research on stocks with a share price of less than $1. he found that as long as the performance of these companies was the same as in the past, they were unlikely to lose money; secondly, he also paid attention to it is recognized that the demand for various commodities during the war is very strong, and even inefficient companies can profit from it. although the united states has not yet participated in the war, it is believed that the united states will support its allies, and in order to achieve a quick victory, it is likely to participate in the war indirectly.

templeton said: "many people think that good luck is determined entirely by tossing a coin. of course, everything is related to chance, but good luck always comes when you work hard. without adequate preparation, without hard work, luck is just a matter of chance. words that have no real meaning.”

in fact, luck is created by all possible choices. always be prepared, make sure you have done your homework, and make sure the result is worth your efforts. only in this way can you have the chance to become the luckiest one.

work harder

templeton found that there was almost no difference in the amount of sweat put in by people with moderate achievements and those by people with great achievements. there was not much difference in the level of effort between the two. the only difference was that the latter put in "a little more." however, the results varied widely in terms of the level of achievement and the quality of the results.

as an investment adviser, templeton found that searching through thousands of companies to find the lowest-cost manufacturer of each commodity was a worthwhile endeavor. to find the most successful investments, you had to understand your existing research and analyze the information. if you can't collect data, you can't make a good assessment of which companies will thrive, which companies will survive the recession, and which companies will provide high-quality products. obtaining this kind of information requires adhering to the "go the extra mile" credo combined with careful advance planning.

in order to establish and promote a "work harder" work attitude, templeton has paid its employees 20% higher than the industry salary level for more than 30 years. templeton definitely pointed out that this was not out of kindness. he believed that as long as the salary is 20% higher than the ordinary level, you can gradually build an excellent team. spending 20% ​​more money will increase the team efficiency by 50%. %.

be diligent and frugal and wait for the best investment opportunity

templeton was fond of quoting dickens's views on frugality: "if the annual income is £20, and the annual expenditure is only nineteen pounds, nineteen shillings and six pence, the result is happiness; if the annual income is £20, but the annual expenditure is £20 6p in pounds, then the result is unhappy.”

after the economic crisis of 1929, frugality became a matter of life and death. life in the 1930s fully demonstrated one thing: if you want to survive and prosper, you must save and invest wisely. saving money for the best investment is the basis for success and security.

at that time, templeton and his wife always insisted on saving 50% of their income. this was not an easy task and required willpower, perseverance, and responsibility for the future. these are all qualities necessary for success.

as a young man, templeton learned a lot about conserving money from farmers. he observed them carefully and carefully. most people who are in deep trouble are burdened with debt, and people who are living a carefree life are not burdened with debt. when the recession lasted, debt-free farmers were able to reduce their consumption and continue to make ends meet on their farms without fear of losing their land. but those who borrowed money found that their debts soared, and many people eventually used their land to pay off their debts, losing their land and even a place to live.

the principles templeton learned from the tennessee farmer apply equally to the stock market. too many people buy stocks on margin, and when the stock price falls, they don't have the extra funds to top up the margin, and stockbrokers have to close their positions. of course, they were forced to sell their shares at the wrong time, when the stock price was well below its true value. but those who were debt-free and refused to buy stocks on margin weathered the recession unscathed and suffered no permanent damage. this once again shows that frugality is the reliever of difficulties and frugality paves the way to success.

templeton's lessons about the right and wrong uses of money don't come entirely from those most basic economic activities. he also studied and studied the lives of benjamin franklin, john rockefeller and others. rockefeller’s words about wealth deeply resonated with templeton: “to become a true millionaire, you must make money work for you. compared with making money make money, the money earned by personal work is very small. ”

"don't borrow money from others, and don't lend money to others. if you lend it out, you will often lose money and people. borrowing it will make you forget to be diligent and thrifty." shakespeare's words are of great significance to templeton, and he has always adhered to these principles. through observation and learning, templeton achieved great success, both materially and intellectually.

in short, templeton attributes long-term outstanding success to "faith." successful investment is the product of the overall relationship between a person's life and the universe. virtues such as diligence, hard work, willingness to pay, and optimism are the passwords for investment success.

(this article is excerpted from "templeton's golden rule", author: john max templeton, james allison, translator: ying shaoquan, su zhimin, etc.)