Financial (wealth) advice I give to myself

These points are the financial advice I want to give to myself and I hope I can follow them unless I find clear mistakes in them.

Work, Life and Investment

I can have two types of career paths.

One is to start up my own business or career. This requires me to put all of my energy and resources into it, because this path may possibly give me a great return (not only monetary returns, but also other sorts of achievement as well) and it will definitely be a very risky and unstable path. Under such circumstance, I should not spend anything on investing in asset markets unless it helps my career directly.

The other type of career path is to find a stable job that can give me a reasonably comfortable lifestyle. In this case, I can spend my spare money in asset markets. The income from the stable job could be seen as a source of risk-free return from my human capital. Like what Nassim Taleb suggests, my human capital is the risk-free asset in my portfolio that generates stable returns. And the money I put into asset markets will be my risky assets in my portfolio that I use for seeking substantially high returns.

I will never be a day trader or a professional investor (who uses own money to invest).

Investment (invest then forget about it)

As I mentioned above, my investment tends to seek for high returns, so risk awareness is definitely something that I need to sacrifice for some degree. I will focus on seeking high returns from growth in the long term, and the followings are my reasons:

Firstly, value investment and hedging require too much of my energy, this could affect my performance in my job. Value investment and hedging require very detailed study and frequent update of information on a large number of assets. On the other hands, since I look for returns in the long term, I do not need to care too much about the market volatility. And because the firms will grow in the future, some degree of overpricing could be captured by the growth in the future, so overpricing is not a big issue, either. Therefore, once I pick up my choices of stocks, I can just sit back and wait for my returns (if I am correct with my predication), this will help me to perform well in my job and continuously earn my stable (and even higher) returns from my human capital, since I am not distracted by my investment activities.

Secondly, such investment strategy does not require me to frequently update my portfolio information to see whether I make a loss or a gain every day. Frequent update will make me more impatient, since bad feelings when experiencing a loss will dominate good feelings due to loss aversion, and such bad feelings can be accumulated and eventually force me to sell off all my assets even though they are probably good assets that deliver positive returns.

Thirdly, value investment and hedging both tend to minimize the risk to deliver reasonable returns; however, because of the low risk, the returns will not be substantially high, this violates my goal of investment.

Therefore, my investment strategy will be investing in companies that I believe are going to grow significantly after very careful study, then forget about it (I mean do not check the prices frequently), if I choose my second career path.