Actually, the very basics.
Fund management is insurance for your future self
But in reality, it is insurance that protects your future self.
This is the finale of Series 3.
Across 12 articles so far, we have explained fund management and risk management. The 2% rule, lot sizing, risk-reward, daily loss limits — all were modest topics. They aren’t flashy, and there’s no appeal of a come-from-behind victory.
Yet there is a fundamental thing that all of them share. That is,Fund management is "insurance for your future self"This means that the constraints you feel today as being slightly tight exist to protect your future self.
Insurance looks like a loss in peacetime
Insurance tends to look like a loss when nothing happens. Even if you pay the monthly premiums and nothing occurs, that money does not come back. You might even think, “I wish I hadn’t paid.”
The same goes for fund management. When the market is favorable, the 2% rule feels tight. You might think, “If I had bet bigger, I could have earned more.” The daily loss limit also makes you feel, “If I had stopped there, I could have recovered.”
But that misunderstands the essence of insurance.Insurance is something that proves its value when something happensWhether you face a streak of losses, a tilt, or a sudden market shift — at those moments, fund management protects you. The modesty in ordinary times is exchanged for survival in crises.
・Even during a losing streak, you don’t take a deadly blow
・Even if you tilt, you can stop at the daily limit
・Even if the market suddenly changes, risk is limited in one instance
・Because you don’t reduce too much, you can harness the power of compounding
If nothing happens, it’s quiet. But when something happens,
this insurance helps you survive in the market.