Just took a quick look at this year’s Nobel Prize in Economics winner Mokyr’s theory. He believes that the key to technological progress lies in the combination of two types of knowledge. The first type is called 'propositional knowledge,' which explains 'why something works,' like how the principles of thermodynamics explain why a steam engine can run. The second type is 'practical knowledge,' which is about 'how to do it,' such as how to build a steam engine and how to fine-tune it. The former is the principle, and the latter is the method. Only when a strong feedback loop is formed between the two can technology continue to advance. A fun thought: compared to physical technology, it feels like there’s more propositional knowledge in investing, but less practical knowledge. In investing, you can find plenty of theories explaining history and the present, but very few that can predict the future. Maybe the Efficient Market Hypothesis is one of them. This theory directly led to the rise of passive investing strategies like buying index funds, which can outperform over 90% of actively managed funds Also, Gemini shared a few widely recognized effective techniques for behavior and emotion management (soft skills): 1. Emotional Discipline: • Action: Strictly follow a predetermined strategy, avoiding greed and chasing highs during market euphoria, or panic selling during market fear. • Essence: This is the practical application of behavioral finance knowledge—recognizing and overcoming human cognitive biases. 2. Patience & Compounding: • Action: Focus on time in the market rather than timing the market. Be able to endure short-term volatility and let **compounding** work its magic. • Essence: The discipline of holding high-quality assets long-term, countering short-termism. 3. Cost Minimization: • Action: Choose low-cost investment tools (like low-fee index funds), reduce unnecessary trading frequency, and minimize tax impacts. • Essence: Counter impulsive trading (impulse/undisciplined patterns) and high-cost products. Since transaction costs are a guaranteed loss in a zero-sum game, minimizing costs is a surefire success technique. Conclusion: Feeling even more confident about the strategy of allocating assets by market cap to the 'gorilla' assets.