Less Complexity, More Simplicity

Have you ever had the experience of trying to solve math problems using sophisticated methods, only to end up realising that the solution can be solved by using simple algebra ?

Most of us thought that doing more results in better outcomes, but there’s a huge misunderstanding in this. In fact, I am writing this post to challenge this statement and present my view that most of the times, we can gain more by doing less.

All things being equal, the simplest solution tends to be the best one – William of Ockham

One of the greatest problem-solving principles of all time is laid out by the great philosopher, William of Ockham several hundred years ago, now popularly known as Occam’s Razor.

I’ve always been an avid reader of the Farnam Street blog, a fascinating blog which has been consistently generating sensible ideas about better decision-making and also mental models from various disciplines that can be applied to our day-to-day lives. Last week, Farnam Street wrote an excellent post about the marvels of making everything as simple as possible (but no simpler!) and gives out explanation about how our tendency to make matter complex can cause problems in our life, including stymied communication, deplorable decisions and wasting our precious time. I feel that the beauty of simplicity also applies to many fields and aspects in our lives, which has not been appreciated by most of the people. Therefore, it’s worth writing a post specifically to highlight how simplicity benefits us in ways that we never have thought of before.

In Investing

In a renowned experiment, scientist and prognosticators set to determine the viability of simple models versus complex models in weather forecasting. The simple weather forecasting model comprises of only three or four variables critical for making astute predictions, for instance air pressure, temperature and air density. The complex model tries to predict the future weather condition by taking complicated variables and mathematical tools into account, such as Monte Carlo simulations and multiple regression analysis. The outcome of the experiment shows that the simple model ousted the complex model by 35% in accuracy.

As a matter of fact, the success of the simple weather prediction model mentioned above owes a great deal to the minimal number of variables it has to control. As the complex weather forecasting model has so many more variables involved to make its judgement about the future weather condition, the probability of committing errors in the input of variables is also substantially higher than those of the simple model. Similarly, in investing, the more variables you need to plug in to your financial models or valuation models, the more forecasts and predictions you need to make to feed numbers into your models. Unfortunately, neither the future interest rates, the future oil price nor the future inflation rate is predictable, because of the dynamic nature of the stock market, and thus making the occurrence of black swans highly likely in the market. To add salt to injury, a mistake in an input of your financial model will amplify the rate of errors in the other variables of the model (because they are interconnected) , forming a sort of domino effect, at last rendering your model futile.

You can see that the change in interest rates and stock market fluctuations never seem to bother Buffett and Munger. Two reasons. Primo, they know that the future is  fundamentally unpredictable. Secondo, they don’t have to worry about it. Why? That’s precisely because they have a much longer time horizon than 90% of the investors in the stock market. To make things clear, possessing a long-term view of buying stocks allows them to trim many variables that are needed in the short-term, in turn lowering their chances of committing errors in their decision. Take the airline industry for example, interest rates matter a lot to airline companies in the short term as the cost of borrowing to fund expansions and buy aircrafts will influence the net income of the company in the next few quarters or one or two years. However, when we contemplate the airline business in a long term perspective, things change. Interest rates doesn’t matter as much as they do in the short term as the feasibility of its business model and efficiency of company’s management is the critical factor which determines the success of the company in the subsequent 20 years. Viewing the action of buying stocks as holding a business for years gives Buffett and Co the privilege to keep things simple and sidestep potential mistakes. That’s why I’ve always advocated holding to stocks for a medium-long period.

In Organisations

Most of the you may have listened to this joke before:

Person 1 to Person 2: Oh My God! I just hurt my ankle this morning.

Person 2 to Person 3: Oh My God! XXX [Person 1’s name] just broke his leg this morning.

Person 3 to Person 4: XXX just got his legs amputated this morning.

Person 4 shouted: XXX is dying soon!

Ok, the joke is of course presented in an exaggerated manner. However, the lesson and warning it gives us is timeless, and organisations should always keep this cautionary tale in mind. An overly complex hierarchical company structure will do more harm than good to a company. As the levels of hierarchy in an organisation increase, miscommunication problems arises and efficiency in communication will also decline steadily. While it seems like a tiny thorn in the flesh in the beginning, the negative effect of inefficient communication is insidious and it may bring a company down to its knees anytime.

Outside threats from competitors, cracks in product line, growing customer dissatisfaction, all these aspects that are fatal to the company are most commonly discovered first by the grassroots level in the company, i.e: salesperson and customer service employees. However, a complex hierarchical organisation structure makes it difficult for grassroots to express their concern to the management of the company as they have to go through so many levels and obstacles to convey their message to top-level management. The entire process is extremely painstaking and cumbersome, disincentivising employees to share their ideas. When executives realise that there is a huge hole in the boat allowing water to flow in and sunk the boat, it’s often too late.

Keeping the communication process as simple as it can be is more useful that you think, potentially saving your company from bankruptcy.

The Commander’s Intent

In the book Made To Stick, Dan and Chip Heath introduced a concept popularised in the military known as the “Commander’s Intent” that can guide employees to make judicious decisions under any circumstances that is aligned with the company’s core value. An excerpt from the book provides a concrete example how the Commander’s Intent can be applied to the business world:

Southwest Airlines is one of the most successful budget airlines operating in the world today. In fact, Southwest has been consistently profitable for more than thirty years.

The secret to their success? Cutting unnecessary expenses. And they’ve been doing it for decades.

In order for them to succeed at such a high level, they must coordinate with over 45 thousand employees, from their pilots to their baggage handlers. They achieve this by using a “Commander’s Intent”, a core principle, that helps guide this coordination.

The Commander’s Intent is a simple, no-nonsense statement that appears at the top of every order, specifying the plan’s goal and the desired outcome of an operation.

During an interview, Southwest Airline’s CEO, Herb Kelleher once said that I can teach you the secret to running this airline in 30 seconds. This is it: We are THE low-fare airline. Once you understand that fact, you can make any decision about this company’s future as well as I can.

Tracey, from marketing, comes into your office. She says her surveys indicate that the passengers might enjoy a light entrée on the Houston to Las Vegas flight. All we offer is peanuts, and she thinks a nice chicken Caesar salad would be popular. ‘What do you say?’

You say ‘Tracey, will adding the chicken Caesar salad make us THE low-fare airline from Houston to Las Vegas? Because if it doesn’t help us become the unchallenged low-fare airline, we’re not serving any damn chicken salad’.

Many corporations like to list out an array of mission statements and require every employee to comply to those statements whenever they are executing their tasks. While the reality is, nobody will gives a sh*t about those lengthy and dull principles while doing their job. Instead of laying out countless mission statements, emphasize on a simple statement, a Commander’s Intent, that can be the ultimate principle to refer to while making tough decisions.

In Designing

Incontrovertibly, It is a fact that flat design is the mainstream in user interface design since 2014 to date. It is ubiquitous – especially on Windows and Android,  the most used desktop and mobile operating systems respectively. It doesn’t take you a whole lot of observation to realise that the app icons of the IOS system has went from three-dimensional buttons and textured backgrounds to relatively simple icons and clean, very readable text. A stark comparison can be seen below :

Image result for ios 6

A large part of the success of flat design can be attributed to its minimalistic design and not overcomplicating design. As the webpage design company, CommonPlaces has stated in its blog:

” The idea of Flat Design came from focusing more on usability, and less on familiarity. The philosophy is that our minds don’t need complex visual cues to understand what we are looking at. We are perfectly capable of recognising shapes and giving them meaning with minimal cues. “

In fact, overcomplicating user interface design causes unnecessary distractions that otherwise have no definitive purpose, and may only distract us from the purpose of the application. The central concept of minimalistic design is to let out brain do the interpretation work and concentrate solely on simple imagery to make icons easily understandable, while being a very simple way of adding hierarchy.

In Life

Most of the time, we make our lives more complicated than it ought to be. For your information, Bhutan is a country in Southeast Asia that is just south of China. The country is known for being really small and for being really happy. They are widely known to be the happiest people in the world.

How do they achieve this remarkable feat? That’s precisely because the minutiae in life is sufficient to make their day full of joy and ecstasy. They focus not on the the materials that they don’t have, they focus on what they already have. They don’t care whether they have ultra-fast internet speed, high resolution 4K TVs or a brand-new Iphone X. They feel thankful and fortunate because they are born in a nation which is free from catastrophes and a picturesque living environment.

Many in our society ask for countless things: they want a huge base of Instagram followers, a romantic relationship, an impeccable body shape, a healthy life, a successful business, a lucrative payslip …… The list goes on. Life do not burn us out, we burn ourselves out. I would like to clarify that I’m not discouraging any of you to stop improving yourself, I’ve always hold the view that constant learning and constant self-development is a moral obligation for everyone. In this context, I am trying to tell you that while you are on your journey to pursuing your dreams and what you want, you should always stop for a brief moment, turn your head back, and look at the trivial details in life that excites you, look at the people who have loved you and given you support. Through this, you will find that life, is so wonderful, and thank god that you grow up in such an environment.

A little piece of advice I give to all of you in order to appreciate your life more and increase your personal happiness level is to write a journal everyday. Try to write a thing or two that excites you or make you smile everyday. In the long run, you can see that there are so many things that can make your life filled with joy, and the outcomes in life doesn’t matter as much anymore, the essence of life lies in the process 🙂


How to learn from your mistakes

“Make mistakes, learn from them, move on”

“Don’t waste a good mistake, learn from it”

“Those who cannot remember the past are condemned to repeat it”

I think that’s enough of it. Since we grow up till we climb the ladder of society, our parents, teachers, and many successful life-achievers have given us the advice to “learn from our past mistakes”. It is a down-to-Earth piece of advice: learning from mistakes allows us to overcome hurdles that stymie our progress in the past and enables us to adapt better to changes in today’s ever-changing society. The pioneers of our time, such as Steve Jobs, one of the brightest mind in investing, Ray Dalio, and Nobel-prize winning psychologist, Daniel Kahneman all share the traits of recovering from failures rapidly, and come back even stronger.

With this in mind, let’s be honest to ourselves: After hearing these quotes for so many times, how many times have we really managed to completely avoid ourselves from committing to the same mistakes again and eliminate bad habits that we used to possess?

If your answer is none, don’t worry, you are just like most of the people out there. Many of us took a long time, even years, just to recognise their mistakes. The fact that everyone tries to tell us the importance of learning from our own mistakes but not teaching us the way to correct ourselves make it so difficult for us to react to our mistakes efficiently. Fortunately, there are some tricks and solutions to address this ‘repeat-our-mistakes’ situation. The first step is of course to recognise your mistakes in an early stage right after you made a mistake

The willingness to find out mistakes

Many of us took ages just to recognise our mistakes because of the way how we view  mistakes and failures. We’re taught in school, in our families, or at work to feel guilty about failure and making mistakes is a shameful thing. An implied value in many cultures is that our work represents us: if you fail a test, then you are a failure. If you make a mistake then you are a mistake. Therefore, we dreaded mistakes. We will bend over backwards and go out of our way just to prove that we’re not wrong. Most people are willing to go that far and even cheat on themselves. To them, failures are too painful to bear, so the simplest way is to just distort reality so that they do not have to face the harsh truth.

Hence, we must change our traditional perception about mistakes and failures, so that we can get out of our comfort zone and stand up to the mistakes you’ve made. The famous Chinese proverb sums it up:

“Failure is the root of success”

Without failures and mistakes, there’s no way we are going to attain our goals in life, work, and relationship. Repeating the old mistakes we’ve done is shameful, but erring is not. On top of that, we should view mistakes as a golden opportunity for us to become wiser and better positioned to face uncertainties in the future. Once we view mistakes as a norm and are willing to open our heart to them, learning from mistakes is not that hard a thing anymore.

Identifying our Real mistakes

The next step to finding out our mistake is to expose our ideas and opinions to our peers or the public so that we can receive feedback from outsiders and get a more holistic view. The reason why exposure to the outside world is so crucial is because if we keep the idea to ourselves and never share it with other people, we will be biased to think that our idea or product is perfect and overestimate the feasibility of it (This situation is coined with the term ‘overconfidence bias’). For instance, if you keep dedicate your time to working on a flying car project in your own garage and never let it appear in the public’s sight, how would you know if people really like flying cars ?

Once we gain exposure and critical feedback from our peers, the public or the market, there comes the critical part: spotting possible mistakes from the feedback we received. The substantial quality that differentiates competent individuals from the crowd is their ability to adapt to feedbacks efficiently and recognising potential mistakes and blunders that may hinder their progress in the future. The only problem that lies in this method of detecting mistakes is that the mistake detected may be only the ‘surface’ and not the underlying mistake (root cause). This is where the 5-WHY analysis model comes into play.

The 5 Whys technique was developed and fine-tuned within the Toyota Motor Corporation as a critical component of its problem-solving training. It is a simple and straightforward analysis to discover the root cause of a problem by asking yourself ‘Why?’ on a particular question for five times. This explanation may be kind of abstract and I think a concrete example will do good. Consider the situation below:

A robot you’ve built has just broke down

Using the 5-WHYs technique:

Toyota 5 whys example

Aha! We then know that the underlying problem lies on the filter of the pump! Of course, this technique can not only be applied to engineering, but also in tracing mistakes we’ve committed in our decisions. Thus, after receiving feedbacks and using the 5-WHYs technique to find out our underlying mistake, all that is left to do is to refine ourselves and fine-tune our mistakes.

Please always keep in mind that mistakes aren’t meant to be shameful, they’re meant for self-improvement. As soon as you start blaming other people (or the universe itself), you distance yourself from any possible lesson. However, if  if you courageously stand up and honestly say “This is my mistake and I am responsible” the possibilities for learning will move towards you. Admission of a mistake, even if only privately to yourself, makes learning possible by moving the focus away from blame assignment and towards understanding.  Even wise people admit their mistakes, so why shouldn’t you ?


High Output Brainstorming

Gathering your team together for a group discussion and collectively generate new ideas to solve problems that you and your team are currently facing, doesn’t that sounds like a fantastic method to come up with wonderful solutions? The idea of overcoming problems and coming up with ideas together has already existed since the ancient times. Many old wise sayings (e.g. ‘Many hands make light work’ , ”collective wisdom reaps wide benefits”) also stress the importance of discussing opinions and making decisions together. With all of these in mind, brainstorming session seems like the best way to conduct the problem-solving process, and that’s why brainstorming session is the favourite of most of the crowd. However, there’s normally a huge gap between imagination and reality









Meeting boredom






A picture speaks a thousand words 🙂

The brainstorming session literally turns into a low-efficiency sleeping room whenever it is hosted. Should we just bash brainstorming sessions ever since and think of problems individually rather than collectively? I believe the answer is nope. Although the brainstorming session has many of its shortcomings, I believe it can still remain as a powerful tool for groups to engage problem-solving. Alas! the concept of brainstorming itself is a brilliant and insightful one, no doubts on that. It is the way how typical brainstorming sessions are usually conducted and the details in the entire brainstorming process that makes it horrible. The book Getting To Yes, by Roger Fisher, has given me unique insights on overcoming the brainstorming dilemma and formulating a set of brainstorming procedure and guidelines which can make high output brainstorming possible, as below.

Prior to the brainstorming session:

  • Call the group for a short-and-sweet meeting to brief them about the problem that the group is facing and needs to be discussed in the session (brainstorming objective). This meeting should only take about 10 -15 minutes as it is only a summary of the oncoming brainstorming session.
  • The meeting is adjourned and everyone in the group is required to come up with at least 3 solutions in respect to the problem in the oncoming brainstorming session.


 1. choose a group member as the brainstorming facilitator

 The role of the facilitator is to: host the meeting, clarify the situation when one of the   group member is making an unclear statement, jot down important ideas on a whiteboard (if there is one) and control the tempo and rhythm of the session

 2. Every group members should then come up with their ideas.

 In the session of the group members listing out their ideas, criticism of ideas are not  allowed until all group members finish proposing their ideas. This helps to shape a  healthy and creative ambience so that group members will be more open and  encouraged to come up with wild ideas (that seems absurd at first thought but actually make sense!).

 3. Stimulation of more ideas and criticism of ideas

 After everyone was done proposing their solutions, the process of criticising ideas can then take place. It is advised for the facilitator to remind all group members that criticism of ideas should be expressed in a polite and not-so-aggresive manner to prevent any unwanted conflicts. When things are heating up, the facilitator should also intervene to keep the situation under control.

 4. Subtraction of ideas

 The weaker ideas will naturally be ousted following rounds of criticism of ideas and discussion

5. Coming up with the best ideas

The best and preferred solution to address the problem is chosen after listing the pros  and cons of each one. One or two best alternatives to the preferred solution will also be taken into consideration.


Ta-da! An efficient brainstorming session should be one that is as simpler as it can be, but no simpler. I still have some thoughts and advice regarding the brainstorming session:

  • The brainstorming should be done within a time frame of 90 minutes (according to my experience, long sessions will only make the process duller and productivity will only decrease over time). If the session really can’t be done within 2 hours, try to host another brainstorming session the following day with a refreshed mind


  • A semi-circular meeting table is the ideal conference table. Several psychological studies have found that round tables creates an atmosphere of relaxation and add a sense of harmony to the meeting room


  • A sensible incentive system can be tailored in a way that rewards the entire group to encourage group members to come up with better ideas and make better, rational decisions. However, it must be noted that one must be very careful in designing such an incentive system as a poorly-designed incentive system can lead to skewed incentives of group members and mess up the brainstorming session. I will not further elaborate on the details of creating an incentive system here.


I hope my insights on brainstorming can help you all who are reading this memo host a much productive brainstorming session and produce high quality works that will benefit the society.


P.S: I will not be posting any content for the next few months probably until December because of my oncoming trial exam and national exam (which is extremely important to me!). Good luck to all of you in your future too.

Stop checking stock quotes everyday from this moment on

Do you still remember the very first time you bought a stock? I still do. The feelings that were contained within me at that moment I use my father’s trading account to execute my virgin trade was, inexpressible. It was a barometer of emotions which includes sheer excitement, enthusiasm, happiness and, of course, a sense of anxiety, fearing that your first investment will end up in the red. Under such a plethora of emotions, I can’t stand the urge to check the stock prices and stock news on Yahoo Finance everyday. I sat in front of my desktop everyday before the market opens, and stare at the movement of the stock charts. My heart was thumping at the same rate of how fast the stock price was changing. I believe I am not the only one here. Any investor will have a similar experience when they first start know how to trade.

However, it’s not a good news if you still carry this habit with you after years of stock-investing experience. There’s a high probability that you are earning significantly less money than your peers in the stock market. Statistics and researches have shown that investors that monitor company news and stock price everyday tend to make 53% less profit than investors who check the company news and stock price once a month. This fact may come as a shock to some of you, as monitoring stock quotes and company news frequently doesn’t seem to be the culprit of your poor investment performance. Hence, I think it’s worth it to delve deep into the cause-and-effect relationship between the two matter discussed above.

First and foremost, please keep in mind that it’s virtually impossible for you to eliminate your emotions when you are focusing on the stock price every moment. In fact, ‘negative emotions’ like anxiety, greed, and fear will spread like wildfire the more frequently you check your stock quotes, and to put it in another way using Buffett’s quote:

“Fear and greed is the foe of the faddist”

When fear and greed is acting on us, they will crush our analytical reasoning skill and rationality. This is because we have already drained most of our brain power and mental energy while worrying about how the stock price is doing every now and then, we are too exhausted to evaluate the attractiveness of an investment properly with deliberate thinking. Consequently, we substitute System 2 thinking with System 1 thinking to make decisions with intuition rather than logical reasoning. That often leads to very, very bad decisions and eventually poor investment record.

Secondo, most of us are prone to take more action than we used to if we constantly check on company news and stock prices, which will trigger the do-something bias. Short term fluctuations in the stock prices should be a noise that you are supposed to ignore, but you can’t stand the itch to do something when you keep on absorbing new information on the company’s feed and share price. Therefore, you start reacting to every small portfolio fluctuations and churn your portfolio regularly, even though most often the best decision is just to do nothing. On one hand, frequent portfolio rotations violates the principles of Occam’s Razor, which by its logic states that less decisions = less errors. On the other hand, the meagre trading cost incurred in every trade will add up to a significant expense that can’t be ignored as it erodes our investment return.

Alas! Many investors still have the misconception that constantly updating themselves with the latest company news is a key step to make better investment decisions. It’s sad when the true fact is that doing so will only drag you down into the ‘information overload’ quagmire. Quoting you an example, let us take a look at the ‘latest news’ of Disney corporation.

Screen Shot 2017-06-26 at 11.38.33 PM

It’s not that hard to notice that most of the recent news covered are either analyst opinions (which hardly count as an useful information from the company itself) or unimportant little matter that is irrelevant. Failing to discover how inefficient it is, we would have wasted a large amount of time seeking for low-quality information and reinforces us to think with a short-term lens. Garbage in, garbage out. It’s no wonder that we always make poor decisions when we shape our investment thesis on information and inputs that doesn’t have huge influence over the company’s future position in the long run. Poor investment record turns out to be the perfectly reasonable outcome in this scenario.\

I don’t care how you are going to make it and what way are you going use, just stop checking on company news and stock prices every moment if you ever care about succeeding in investing. I’ve been there and done that, so do many others that I’ve witnessed in my life. It’s insidious, and you may not know why are you failing in the stock market until you came across this short memo. I merely hope my advice and perspective can help you pull yourself out from this dreading habit.

I would like to end this note with an amazing quote which I stumbled upon recently.

“The stock market is a device transferring money from the impatient to the patient”  – Warren E Buffett

How to be lucky in your life

Luck is one of the things that can be obtained by literally everyone on this world, yet so many complained about their misfortune in life. In fact, I am actually shocked when I get to know that so many people tend to think that luck was unattainable in life. Today, I am going to share some of my perspectives on luck and how we can substantially improve our luck in life.


1. Think positively

The first step to have a lucky life is to think positively about things that happen in your life. Think about it, how can we possess luck when all that is stuffed in our mind is negativity? Imagine this scenario: You are fired by the company which you have worked 20 years in it because of an economic recession. Your subordinates which is in many ways less competent than you, just took over your position. You’ve lost your bread and butter overnight, you still have three kids to raise and your mortgage loan to pay. You can choose to lock yourself in the bedroom and complain about your misfortune all day long, or sit down and think of what to do at this moment to overcome this hardship together with your family. One thing that can be certain is that the sticky situation that you are facing isn’t going to change. Instead of complaining like an immature boy, why don’t you position yourself optimistically and view this as an opportunity for you to rethink about who you are and a chance to pursue your dreams? God always leave many doors opened when he shut one of your window.

2. Surround yourself with positive people

Since we want as many positivity as possible in our lives, we should always surround ourself with positive people, people that can make our lives happy (In fact, many studies show that our happiness is directly proportional to luck as we perceived in our lives). There is always a saying, ” Tell me five of your closest friends and I’ll show you what kind of a person you are ”. Negativity is contagious; it can be spread through words and actions in your everyday life bit by bit. Hence, the easiest and time-saving way to improve your luck is to expose yourself to optimistic peers. You may even start to think of how lucky you are to come across those people in your life !

3. Pursue knowledge and observe things

Knowledge is power. Knowledge is also the source of luckiness. Many people may wonder, what does knowledge have to do with luck in our lives? This question can be easily answered by throwing out more questions such as: Is Jeff Bezos lucky to catch on the rapid development of the Internet when he build Amazon? Is Warren Buffett lucky to build his wealth in the stock market when the American stock market is in its golden era? Is Bill Gates lucky because his mother is on the board of director of IBM and this leads Microsoft to get the contract for the operating system, which eventually makes Windows the default operating system of every PC?

The opportunity is there for everyone, Jeff Bezos isn’t the only one to be there when the Internet is growing rapidly and millions of people grow up in the same era as Buffett in the same country. Why only few of the population saw what was coming? Are the rest of them truly unlucky? No, it was because they simply do not contemplate what was happening around them. The depth of their thinking and knowledge render them unable to capitalize on the opportunities that they are given. Every ‘lucky’ guy is ready to act on the chance they are given and that is what makes them ‘lucky’. Knowledge enables them to discover chances around them and gives them the ability to tackle on these life-changing opportunities. There is no way Bill Gates will be offered the operating system contract by IBM if he doesn’t have a sensible business plan and impressive business acumen. The source of his luck comes from his ability and his ability comes form accumulating knowledge and constant learning.

Set you goal to be a little wiser everyday, because that means being a little luckier everyday.

4.  Treat others kindly

One of the by-products of treating other people well is being able to gain more luck in your life. Little pleasant actions such as offering your seat to an old lady in the bus, buying breakfast for homeless and sharing your happiness with your colleagues in your everyday life will establish you as a ‘positive person’ in other people’s mind. Remember the old axiom “If you treat people well, people will treat you well” ? It is highly likely that people around you will go out of their way to support you when you are facing downturns in your life if you be kind to everybody. Their support will make the initially depressing situation less deplorable and unexpectedly turn it into only a small problem for you. Besides, people will be willing to share their knowledge and insights with you, they would’ve also thought of involving you when they come across a rare opportunity that will benefit both of you. This can turn out to be the greatest source of luck in your life.

5. Visualise success

How well do you think you will perform on a date, job interview, or sporting event if your thoughts are filled with reasons you will fail? The odds would not be in your favor. The best athletes see themselves winning a game long before it starts. The best stage actors imagine an audience exploding with laughter and applause before they set foot on stage. If you’re going to a job interview, imagine how thoughtful your responses will be during your drive. If you’re preparing for a date, imagine how classy / handsome / sexy / funny the other person will find you while you get dressed. You must first see success happen before you can make it happen.

I think most of you have probably realised that all these steps above aren’t any big secrets. Everyone knows it and they are not that hard to implement, yet many still fail to realise that luck is already on your side. Being able to carry out day-to-day activities without difficulties, being able to see your parents everyday, being able to read this post comfortably at home.

Having a normal day is perhaps one of the best thing that happen to us 🙂


Idea generation in investing

I still remember that moment three years ago, when I was still a novice investor reading Berkshire Hathaway’s annual report with full of excitement and enthusiasm, I was clearly amazed by the spectacular returns of Buffett and Munger over the last 50 years in the stock market. Their early investment in well-known companies nowadays such as GEICO, See’s candy and Coca-Cola are investment classics that should be included in the textbooks in business schools. Nevertheless, what I was wondering at that moment was: How did Buffet manage to unearth those hidden treasure when they are still relatively small and was not in the public limelight? Are good investment ideas that easy to stumble upon? Definitely not. After three years of experience in the stock market and accumulation of knowledge, I finally have some answers for the question I’d asked myself three years ago. My idea generation process often takes place in four forms.

1. Screening

Screening softwares and services are provided by various financial data and software companies such as Bloomberg Terminal, Capital IQ and Factset. For individuals that may not want to spend such a hefty amount on financial softwares, there are also many stock screening tools on the web offered by Morningstar and Yahoo Finance. Most importantly, it’s free! Screens enable us to filter stocks based on different metrics such as a minimum Return on Invested Capital, Debt to Equity Ratio and the free cash flow of the company. Stock screening definitely does a great job in helping us to weed out those stocks that don’t meet our requirements and focus on the instruments that are within the user-defined metrics. However, it is not enough to discover great companies that can last for many years merely by picking stocks based on the results of our screening process. We must have the ability to see the big picture from the numbers that are screened. For example, a higher than average debt-to-equity ratio doesn’t implies that the company is a rotten apple. It may indicates that the company needs massive capital to fund its growth and expand market share. It might have a bright future ahead of it, making it the next Google or Amazon. Likewise, a low debt-to-equity ratio doesn’t make a company a ‘quality-guaranteed’ company. On the other hand, investors should have additional filters to really get down to something interesting from a long list of companies that appear on the screen. The filter includes qualities and traits that should exist in a well-managed company such as candid management, healthy cash flow and a healthy amount of debt. There are too many qualities in a company that should be taken into consideration so I will not list them out one by one here. (That would probably cost my entire school holiday!). In short, stock screening is a very useful tool to generate ideas in a short time span but it must be used judiciously, coupled with your own analysis and filters.

2. Other investors

You can get some fantastic ideas from other investors occasionally, ranging from institutional investors such as David Einhorn and David Tepper in investment conferences, to people around you which share the same passion towards investing with you. For me, my friends and pals are still concentrating in their video games and social network. Hence, my only source of investment ideas from people are my father and professional investors that share their ideas. I feel the need and commitment here to make a point that getting ideas from your friends and other people doesn’t mean that you should buy in their idea and just follow their decision without doing any due diligence and thinking. This will only make you invest like a headless chicken and end up in red. What you should do is trying to understand the underlying reason of their decisions, their investment analysis process and think of disconfirming evidence to challenge their view. If after you did your research and analysis to come to a conclusion that the particular company is an attractive one, then congratulations! you earned yourself a great company from other people. However, if you think that the company is overvalued and thus not worth investing, at least you get to improve your thought process and obtain a different perspective from the others. This is a heads-I-win, tail-I-win situation!

3. Look and Observe

I began reading about Peter Lynch and his investment concepts before I really began studying Buffett. His common sense approach stroke me hard and I still think that it is a really great approach to find out interesting ideas that are not known by anyone. Looking and observing at the things that is happening around the world is one of the best investment I could’ve ever made. You will soon start to realise that many of the things around us pretty much contributes to an investment idea. I never like to go the market with my mother because I’ll need to wake up really early. One morning my mother dragged me out of bed and without any other choice, I would need to follow her to the morning market. While my mother was buying eggs, she was complaining about the sky-rocketing egg price recently. Two months later, the largest egg company in Malaysia, Teo Seng announced its earnings, with profit exceeding the consensus by a large margin. Since then, I was always prepared to wake up early and follow my mother to the market. Quoting another example from the book One Up on Wall Street, Peter Lynch has always bought his children Disney films and toys and his children were never tired of watching them over and over again. The rest is history. He still regretted missing this huge opportunity until today. However, the quote ‘Invest in What You Know’ made popular by Peter Lynch is being misunderstood by the public. Some 25 years after his retirement from running Magellan Fund, Mr. Lynch clarifies that he never said, ‘If you go to a mall, see a Starbucks and say it’s good coffee, you should call Fidelity brokerage and buy the stock,’ ”. 

Every investor should keep in mind that however good is the product of the company or however confident your friend seems when he recommend an idea to you, you should conduct enough due diligence and analysis before making your investment in a company. Never let the herd guide your thinking and don’t let their mind make decisions for you. As Mr.Buffet would have put it,

“Don’t think of buying stocks, think of buying businesses”


What Every 20 Year Old Should Know

During the filming of #AskGaryVee Show 244, Taylor, a 22 year old fresh out of college, phoned in for advice on how she can build a business. What followed was one of the most important pieces of advice I have recorded and is applicable to almost all my community, but definitely to young people across the world between 20–30 years old.

(I apologize for not being able to embed the entire video here due to the constraints of my free wordpress plan)


Source: Google Images

This conversation really struck a chord with me. Although maybe some of you have already received similar advice from your parents, I strongly recommend everyone in their teens to just spend 15 minutes and listen to this thought-provoking conversation. The advice offered by Gary Vaynerchuk, one of the most successful serial entrepreneur in the world. Here is a topic from the conversation that I thought were worth bringing out:

Key Takeaway : Action

I believe that most of the teenagers today, at the age of about 20 – 30 years old, will more or less face this problem: Seeing other teenagers enjoying huge success while you are still here, lying on your bed endlessly scrolling through your Instagram. Phew, your entire Sunday was over, and wasted again.

Don’t worry, you are not alone. There are many teenagers out there who are like you and they are also having the same thoughts in mind: Craving for success in their early life, but not knowing where to start from. I have heard of many people saying: “By 26 I am going to make it to the Forbes 30 Under 30 list and become one of the hottest tech entrepreneur in Silicon Valley”, and continue to post videos to their Snapchat story. That is not the way things should be done. This is not the way multi-millions business are built.

I used to be one of you who dream to be a billionaire and go to bed without having produced any ideas or actions everyday. Fortunately, I was struck by a simple thought that changed my life forever when I was 13 year old. One night when I was about to drift into dreamland and start my ‘billionaire dream’ all over again, a voice popped up in my mind, saying: What if you keep dreaming of becoming a billionaire everyday and still hasn’t really done anything at all when you are in your 30s ? It was just a brief idea which came across my mind, but it left a permanent effect on me since that day. I know I definitely must do something.

Thus, i began my journey to find out my interest in life and what am i going to do for the rest of my life to earn me a living (Yes, I am lucky enough to find out my passion for investing at a really young age). The first book I read on investing is The Intelligent Investor, the second is Security Analysis, not knowing what sh*t the author is trying to express (only knowing later that what a brilliant mind Ben Graham was! ). But that is how i get started, and I am grateful I marched out this small step. Today, I’ve already grown a substantial amount of knowledge compared to the 13-year-old me, compounding your knowledge is the fastest way to build your wealth. The more I read, the more I realise how ignorant I am and there are more and more knowledge waiting for me to explored.

Back to the topic, which I believe most of you are eager to ask me now: How do I get started ? How to make my life better from today onwards ?My answer, as always, is to start small. It’s almost impossible for one to lay out a 5 year business plan and start to execute the plan on the following day. Even most of the business titans in the world started small, and eventually grow their business into the behemoth they are today. I have what I called, the ‘Yang pathway’ for those who do not know how to get started and create success in their life.

Yang Pathway:

1. Find out things that you are good at and passionate with

Your life won’t be able if you are going to spend your whole life working on stuff you doesn’t like at all. The best bet to a bright future is to explore things that you will always be willing to thrive in from dusk till dawn.

2. Develop your skills and expertise 

Now that you’ve found your passion and the next thing you are ready to do is to build up your skill set and enhance your knowledge in that particular field.Aim to be the top 1% in the stuff you’re passionate with. To be honest, it’s not going to be easy and it normally take years for someone to achieve mastery in his field. During the process of developing your skills, you may face obstacles and feel that you’ve reach a ‘plateau’. You feel that you can’t keep going anymore, that is the darkest period in your learning phase. But believe me, all you have to do is just climb up every time after you fell. For example, it often take years for a novice investor to develop his investing philosophy and find out which investing style suits him best (especially in such environment when feedback is slow and not concise). That requires not only patience, but great consistency. Having the ‘roly-poly mentality’ is important for you to overcome this hurdle and confront future challenges.


Image result for learning curve graph

3. Build a platform to share your knowledge with others / Provide your service to society

Sharing your knowledge and skills with other people is always a joy and also beneficial to yourself because while you’re teaching others what you’ve learnt, you are also reviewing your knowledge at the same time (the Feynman Technique). Say that you are an avid software programmer, and you’ve already mastered multiples programming languages such as Python, Ruby etc. You can develop your own website using your skills and upload lessons or learning tips to the website.

4. Monetise your product

If you manage to grow your website into a community and help users out with the problems they are facing, Congratulations, you are on the right track ! However, a product that can’t bring in any profit still can’t bring you to the place you want to be. This is why the business model is so crucial because it is the key that determines  the success of your product. You can bring in revenue by different business models such as a subscription based business model, freemium and etc. Always review your business model to examine its feasibility and keep your users engaged. Facebook is one of the platform that manage to leverage its enormous user base to bring in lucrative profits. Facebook modularise advertisements by allowing advertisers to target customers directly.

I hope that the ‘Yang Pathway’ can provide all the teens outside a sense of direction in their life and get themselves started. I can’t guarantee it’s useful for everyone but at least it can act as a guide for you when you are lost.

Finally, there’s a quote I think that is worth sharing:

The best investment of all time, is investing in yourself