Duan Yongping: True value investing rarely loses money! These 4 criteria will help you avoid 90% of investment traps. Duan Yongping once said something particularly audacious: True value investing rarely loses money. Note that he didn't say making money is difficult, but losing money is. A person who has been investing for decades dares to say this not because of luck, but because he has thoroughly understood one thing and stayed away from speculation. Almost every penny you lose in the market is not from investing, but from speculation; you just don't realize it. First, understand clearly whose money you are earning. Duan Yongping puts it very directly: investing earns you money from the company, and has nothing to do with anyone else. The company grows, makes money, and distributes dividends; you receive returns along with it—that's investing. But think about yourself: before buying, did you research the company's business, or the market trend? Was it the company's value, or other people's opinions? You might see a blogger saying they're bullish and rush in, then someone in a group says it's going to drop, and you panic and sell. You think you're investing, but in Duan Yongping's eyes, every penny you earn is hoping someone else will buy it at a higher price. That's not investing; that's guessing what others are thinking. Remember this: investors study companies, speculators study people's hearts. Secondly, look at your trading frequency. Duan Yongping says that investors remain steadfast for the long term, while speculators trade frequently. Buffett held Coca-Cola for over thirty years, and Duan Yongping held NetEase for over a decade, weathering countless market dips without batting an eye. Look at yourself; the slightest market fluctuation makes your hands itch, and three days without trading makes you feel like you've missed out on the world. Frankly, frequent trading means you don't know what you're buying, or its value, so you panic at the slightest drop and want to sell at the slightest rise. Duan Yongping has this. He has a particularly harsh saying: frequent trading means you lack confidence in your own judgment. If you truly understand a company, you'd choose it like a wife; why would you change partners every day? The poor chase highs and sell lows, the rich hold their positions like mountains. The third and hardest rule: Never short sell, never borrow money. Duan Yongping says that short selling and leveraging are, without exception, speculation. No matter how confident you are, no matter how accurate your analysis, never touch these two things. Why? Because borrowed money has a time limit, while market frenzy has no time limit. You can judge the direction correctly, but if you can't weather the storm, a large fluctuation will wipe you out prematurely. Duan Yongping calls this money outside your circle of competence. He said, "Don't touch what you don't understand, don't earn money you're not confident in." This sounds conservative, but it's actually a matter of survival. Think about it, those who use leverage double their money when things are going well, and lose it when they're wrong. When they're trading, they lose everything; ten times their initial investment can be wiped out in one go. True investment is about staying at the table forever, not gambling and leaving. The fourth, and most insidious, rule: if your mindset needs management, then you're speculating. Duan Yongping says that investment doesn't require mindset management; anything requiring mindset management is speculation. What does this mean? If you buy a company you truly understand, and the price is far below its value, will you panic if the price drops? No, you'll actually be happy. It's like buying the same thing on sale – you can buy more. But if you're hesitant when you buy, can't sleep at night, constantly watching the market, ecstatic when it goes up, and sleepless when it goes down, what does that mean? It means you lack confidence; it means you're not buying a company, but gambling on the next big thing. Mindset is your trading strategy's detector; true gold fears no fire, while counterfeit money is immediately exposed. These four points, taken together, essentially boil down to one thing: investment is anchored in the company, speculation is anchored in others. If you focus on the company, time is your friend; if you focus on others, emotions are your enemy. Why is it so difficult to lose money in true value investing? Because you're buying companies you understand, and paying far below their value. No borrowing money, no short selling, no frequent trading – you're closing the door to losses for yourself. Review these four criteria for every single transaction you've made. If you fall into any of these categories, don't fool yourself; that's not investing, that's speculation. Those who can see this before losing money have already outperformed most people in the market.