The most important thing about investing is to always keep yourself in a position where you have choices.

In June, the Nasdaq 100 once again corrected by about 7% from its high point.

Due to taking profits at previous highs and continuous capital injections, my cash position has been expanding. Every time the market experiences sharp volatility, I gain a deeper understanding:

Your position determines your mindset.

When you have little cash, a market drop can easily make you panic; when you have ample cash, you might even hope for the market to drop a bit more.

Because you know that a drop is not a disaster, but an opportunity.

Taking advantage of this correction, I again bought some core assets in batches according to plan.

The market's expectations for AI are getting increasingly high, sentiment is becoming more exuberant; and trading behavior is also becoming more short-term oriented, with options getting shorter and shorter. The PDT rule, enforced for over twenty years, has been canceled, making the entire market more speculative.

Investors are paying less and less attention to fundamentals, valuations, cash flow, and long-term potential.

Instead, they prefer to bet:

Bet on earnings reports.
Bet on interest rate cuts.
Bet on CPI.
Bet on a single phrase from the Fed.
Bet on a product launch event.
Bet on a piece of news.
Bet on whether the market will open higher tomorrow.

Add to that the well-known "Capitol Hill stock god,"

who says the situation is tense today, then suddenly changes tune tomorrow saying everything's fine.

So, as ordinary investors, we can never predict whether the market will rise or fall in the short term.

But we can do something more important:

Keep ourselves in a position where we always have a choice.

"The Psychology of Money" gives an example of card counting in blackjack.

Many people think card counters are amazing, able to know the next card. Actually, that's not true.

The essence of card counting is not predicting the future, but judging which cards are more likely to appear next based on the cards already dealt.

In other words, they only slightly tilt the odds in their favor.

But even with this edge, truly mature card counters won't bet all their chips at once.

Because they understand one thing very well:

Even if you have an edge, you can still lose consecutively.

If you bet too much on one hand and lose, you're out of the game. Then, even if great opportunities come later, they have nothing to do with you.

This is actually the most important thing in investing:

It's not about being right every time, but about not being forced off the table even when you are wrong.

The problem for many investors is not a lack of vision, but a lack of room for error.

They like a company, so they go all in.
They like a trend, so they add leverage.
They think a certain price is the bottom, so they use up all their cash at once.
They think the future is likely to go up, so they completely ignore low-probability risks.

As a result, once the market moves differently from their expectations, they become very passive.

What's truly dangerous in investing is not the loss itself, but losing your right to choose after a loss.

That's why I increasingly believe that the most important thing in investing is not squeezing the last bit of return, but keeping yourself in a position where you always have a choice.

This is also why I'm placing more and more importance on cash.

Many people might think cash is a drag on returns.

In a bull market, cash is of course annoying. Others are fully invested and rising, while you're holding cash, seemingly missing out.

But the problem is, the true value of cash is not demonstrated when the market is rising, but when it's falling.

If you have cash, you can add to your positions when prices drop.
If you have cash, you don't have to sell at a loss during short-term downturns.
If you have cash, unexpected family emergencies won't affect your long-term investments.
If you have cash, you have the ability to act calmly when a golden opportunity appears in the market.

Holding cash is not about predicting the market will definitely fall, but about acknowledging that you cannot accurately predict the market.

As Graham said:

The purpose of a margin of safety is to render forecasting unnecessary.

Therefore, a truly mature investment system should not be built on "I can predict correctly every time," but on "Even if I predict wrong, I can still survive."

Buffett's long-term emphasis on cash and liquidity is also because he understands very well:

Cash gives you the initiative when others are in panic.

Investing is not a sprint.

You don't win today and it's over tomorrow.

Investing is a long-term game that lasts for many years, even decades. In this game, the most important ability is not making the most money in one go, but whether you can stay at the table.

As long as you are still at the table, opportunities will keep appearing.

Bear markets will pass.
Panic will pass.
Liquidity crises will pass.
The value of good companies will eventually continue to accumulate.
Great trends will also advance amidst volatility.

But the prerequisite is that you are not forced to leave the game during the darkest times.