This article had actually been sitting in my drafts for quite a while. I just never published it. Then, over the past few days, the market went through another round of decline, and the impact on me was significant. A move like today's naturally has its direct triggers. But more than explaining a single selloff, what matters to me is something else: times like this make it especially clear how important a rational framework really is. The market will not stop moving just because emotions are running high, but our judgment can very easily be pulled off course by emotion. So I decided not to wait any longer. I will start here and write this "Quantitative Thinking" series properly.

I am not writing it because I am eager to present final answers. It is more like a way of recording, piece by piece, how my understanding of the market has shifted: my doubts, my revisions, the things I once believed and later corrected. More specifically, I want to keep a record of how I gradually moved from making decisions by feel to placing more weight on rules, evidence, and boundaries.

Looking back, the first time I really began thinking about these questions concretely was during the market decline around Lunar New Year in 2024. That was when I first felt, very clearly, the difference between two very different states of managing money.

On one side was a simple portfolio I managed myself inside the market. The rules were not complicated, and the actions were not frequent, but because I knew what I was doing at each step, the account recovered fairly quickly. On the other side was a batch of actively managed off-market funds I had bought in the previous two years. A few months later, the broader market had already come back, yet those funds were still climbing upward very slowly, and some had not even broken even.

During those days I kept reopening the account, watching the numbers move little by little. What occupied my mind was no longer "when will this get back to breakeven?" It became a more basic question: if I hand money to someone else to manage, but in the end I still cannot clearly explain the logic by which it is operating, does that really count as peace of mind?

Most people do not begin taking investing seriously because they suddenly understand the market. They do it because, gradually, they realize that money is something they will eventually have to take responsibility for themselves. That was true for me as well. From that point on, I stopped being satisfied with simply "buying a product that seems good." I increasingly wanted a method I could understand, review, and explain in my own terms. Writing these thoughts down now is less about summarizing a ready-made answer than about recording how I gradually arrived here.

Why I started doubting the idea of handing money to someone else

I really entered the market in 2023. When I first started managing money, my path looked similar to that of many others: off-market funds, diversified allocation, long-term dollar-cost averaging. The logic sounded perfectly reasonable, and at the time I truly believed that if I stretched the horizon long enough, volatility would eventually be smoothed out.

Then came the decline from late 2023 into early 2024, and things became much more concrete. I was holding more than ten products, and almost none of them were truly unaffected. What I felt most directly during that period was not simply loss. It was vagueness. I knew I was absorbing drawdowns, but I did not know where those drawdowns were really coming from, nor did I know how I was supposed to evaluate them going forward.

By April and May of 2024, the broader market was slowly recovering. Using a very simple portfolio rule set, I had already brought my in-market account back into profit. But that group of actively managed off-market funds was still recovering at a very slow pace. At that point I became increasingly convinced that the problem was not just about return differences. It was about who actually held the right to understand what was happening. The money was mine, but the judgment was not. The result showed up in my account, but the logic remained in someone else's hands.

What truly unsettles people in investing is often not a temporary loss. It is not knowing why they made money, and not knowing why they lost it. If a result can only be explained by luck, then it is very hard for it to become something you can rely on for the long run.

Why I later began turning toward quantitative thinking

After that, my attention gradually shifted toward quantitative methods.

These days, I prefer to think of quant not as a way to make myself look more sophisticated, but as a way of constraining myself. The first question is not "how do I build a more impressive strategy?" It is "how do I make my judgment a little less emotional and a little more grounded in something testable?"

The longer I have been in the market, the more I feel that the hardest part of investing is not insufficient information. It is that emotion so easily jumps ahead of judgment. After a stretch of gains, it becomes easy to feel that a trend has fully formed. After a stretch of losses, it becomes easy to believe that the whole logic has broken down. Many times we think we are analyzing, when in fact we are only being pushed around by whatever happened most recently.

What has been most useful to me about quantitative thinking is exactly this. It does not suddenly make me smarter. It forces me to slow a judgment down and ask whether it actually has support behind it. Rules cannot guarantee that you will always be right, but they can at least block some of the impulse of the moment. Data will not think for you either, but it does force you to distinguish between what is merely a feeling and what can genuinely count as evidence.

Later on, I built some very plain rule-based strategies on my own. My resources were limited, the tools were simple, and in some cases there was no need to write any code at all. But it was through that process that I became more and more convinced of something: tools do not think for you. They amplify the way you think. What is truly scarce is not an interface, not code, and not some framework that merely looks advanced. What is scarce is whether you are willing to let your judgment be tested by rules.

Why I want to write this series

I want to write this series not because I have some "winning strategy" to reveal, and not because I want to portray quant as a mysterious technical craft. Quite the opposite. I want to talk about it in a plainer way.

To me, quantitative thinking is not first about sophistication. It is about training myself to rely a little less on subjective imagination and a little more on evidence; a little less on impulse in the moment and a little more on a sense of boundaries. Writing these thoughts down is, on one hand, a way of forcing myself to think through many judgments that were previously vague. On the other hand, it is also a way of leaving behind an honest record of how I have changed in the process.

So this series will not recommend stocks, and it will not promise shortcuts. What I want to write about instead is the logic behind strategies, the kinds of misjudgment that appear again and again in markets, and the understanding I have gradually corrected through practice.

That is probably the real reason I am starting it now. Not every piece will finish the whole problem. But if I can record as truthfully as possible the path from "handing money to someone else" to "starting to build my own method," then that alone already feels worthwhile.

贡献者: Junyuan He