In my book, Are Your Health and Finances Linked? A Christian Entrepreneur’s Quest (released in 12/2022), I talked about my investment strategies. Here is an excerpt from the book.
When I studied at the University of Illinois for my MBA in finance, I learned something crucial, not from my textbooks but from a professor’s comment. “Making money is important, but how to manage what you have is even more critical.”
Financial health depends on what you do in both areas.
All too often, we hear about big lottery winners who later lost it all.
I read this piece of news online some time ago with interest. “Five years after a Kentucky resident won a $27 million jackpot, he was penniless and living in a storage shed with his wife. The couple squandered their fortune on the typical goodies that sink so many lucky winners. They bought dozens of high-end cars, mansions, and a plane…”
In my mind, managing my money takes precedence over bringing in new money. In this booklet, I’ll share my tips on the management side and also touch upon investment.
Some questions may pop up at the mention of investment.
Should Christians invest in the stock market? Is it like gambling? What does the Bible teach about investing?
Remember Jesus’ parable about the three servants and their given talents? In Matthew 25:14-30, Jesus talked about a man who, before he left for a trip, summoned his three servants and entrusted them with talents in various amounts according to their abilities. The first two individuals doubled their money, while the third person dug a hole in the ground and hid his talent. When the master returned, he gave the third servant a hard time.
People often ask, “What did the third servant do wrong? Wasn’t it the right thing to do to keep the master’s entrusted treasure safe by burying it? Why did he get reprimanded? What would the master say if the other two invested and lost their money?”
My reply below is based on my understanding of God’s attributes. The master had the entire world under his sovereignty. Loss or gain wasn’t his primary concern. What he wanted from the three servants was their obedience to his command to make good use of what they had. Risks and challenges are critical ingredients of the abundant life that the Lord has promised us.
Everything, including my life, is entrusted to me temporarily. My responsibility as a manager is to well use what God has given me according to His guidance.
So, I not only invest in stocks but also trade options.
In my MBA program, I learned a lot about different techniques related to financial management, yet three key principles from my professors benefitted me more than anything else.
The first principle: The U.S. market is very efficient. When a piece of news reaches you, likely most people have already learned about it. In other words, don’t believe what others tell you about which stock to buy and don’t invest in anything you don’t understand.
The second principle: At any given time, the pool of money is fixed. When someone loses money, where does the money go? To another person. If you want to make money, pay attention to those who constantly lose money and try to do the opposite.
The third principle: Risks and returns always go hand-in-hand. Higher returns mean greater risk. There is no such thing as a no-risk investment. Even money in your checking/saving account, seemingly safe on the surface, encounters two risks: opportunity cost (the failure to use cash in an economically efficient way) and inflation.
I derive most of my practical investment strategies based on these three pieces of advice.
While in high school, I used to go to the library, read every book on one shelf, and then move on to the next. Reading and writing are very important to me. It seems I have a longing that can’t be satisfied by reality. I love to escape into books and become someone graceful, witty, and popular.
Currently, I work for a small biotech company and have published 120+ scientific books and papers (under a different name). I’m a latecomer to creative writing. So far, I’ve published three books. Here are the links for my books:
I’m married to my wonderful husband, a retired pastor who encourages me to pursue my dreams. We served together at three different churches from 1987 to 2020.
I would love to connect with you. You can drop me a note anytime at ruthforchrist.com. The following are my gifts to anyone who sends me a request note.
(1) Free article about relationship per request:
Fabrics: 7 Habits to a Better Relationship
F – Fight fair and square
A – Away just the two of you
B – Belong in a small group
R – Respect
I – Intimacy
C – Co-own more experiences, fewer things
S – Something extra
(2) Free handmade Christian bookmarks per request: The bookmarks are embedded in articles on my website (e.g., see “THINK: Your words matter” under Blog – previous articles). I’ll pay the shipping fee (U.S. only).
Drop a note if you would like either free gift.