Chapter 15: Grow your Money at Millionaire Returns

'Risk comes from not knowing what you are doing' Warren Buffett

The Truth is:

Low Risk (not high risk) lead to Extremely High returns !!!

Let me ask you a question:

When comes to investing, most people share the painful experience of getting burnt in the stock market or in unit trusts. What is your first opinion on your mind?

Common man's thinking:

1. ' if i have kept all my money in the bank, i wouldn't have lost half of it'.

2. ' After so many years of buying and selling, i find that after all the effort i merely broke even'. 'i should have keep all my money in the bank instead'.

3. ' Every time i buy a stock, it seems to go down'.

4. 'in order to earn high returns, you must be a risk taker!'

This is totally rubbish!

All of us have been brainwashed by this inaccurate generalization. If you have the same thinking as the above, then you have developed a phobia of investing and formed the belief that ' investing is risky' .

No...

In actual fact, GREATEST investors are NOT risk takers. They are in fact very risk Averse. Warren Buffett will only invest in a stock if it has very low downside and very high probability of success of 90%.

So to be a winning investor, you MUST be a risk adverse!

But if high risk does not lead to high returns then how to be rich?

THe answer is ' FINANCIAL INTELLIGENCE'.

High financial intelligence lead to high returns. When you have high intelligence, there is low risk, because you know exactly what you are doing. When you don't have strong financial intelligence to fully understand the business behind the stock, then investing becomes very risky.

The end...