On the evening of July 30th, in the table tennis mixed doubles final at the Paris Olympics, the Chinese pair Wang Chuqin and Sun Yingsha won the championship with a score of 4 to 2 against the North Korean pair Li Zhengshi and Jin Qinying. After winning the table tennis mixed doubles final at the Paris Olympics, Wang Chuqin and Sun Yingsha should have been celebrating, but such an accident occurred.

According to reports, Wang Chuqin placed the racket in a box outside the court while taking photos, but the racket was accidentally stepped on and broken by a female reporter. This is definitely a huge blow to Wang Chuqin. Because, this is equivalent to having one's "rice bowl" broken by someone.

As a result, in the men's singles table tennis match at the Paris Olympics the next day, Wang Chuqin was defeated by the Swedish player Moregard with a score of 2 to 4, and was eliminated in a surprise, missing out on the top 16. Wang Chuqin is the world's top player, but he missed out on the top 16! It can be seen that the damage to the racket had a significant impact on him.

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The person who damaged Wang Chuqin's racket must bear a great responsibility, but is Wang Chuqin himself completely free of fault? His major mistake lies in not keeping his "weapon" out of his sight, and not exposing his "rice bowl" to risk.

In the future, Wang Chuqin will surely remember the lesson and will hand over the racket to a special person for custody after the competition, or even tie it to his waist to prevent similar incidents from happening again. What is the "rice bowl" or "racket" for our stock investors? It is the principal. The principal is the tool for our money to make more money.

Buffett has three major investment principles: First, protect the principal; second, protect the principal; third, remember the first and second principles. We investors must protect our principal well and not let it be at high risk like Wang Chuqin's racket.

How to protect our principal in the stock market?

1. We must be very familiar with the fundamentals of the stocks we invest in. Our broad stock investor friends often like to buy stocks of companies they don't understand at all, and not understanding the fundamentals of the company is to put their principal at great risk. Once the market plummets, they will be very fearful because they don't understand the company and don't have much confidence in the company's future. So they will fall into the dilemma and pain of whether to cut their losses.

2. There must be a margin of safety, and we should buy at a relatively low price. Many stock investors buy stocks at a price-to-earnings ratio of 50 times or even more than 90 times. This itself is to expose their principal to high risk. Such high price-to-earnings ratio stocks require the company to maintain an extremely high growth rate in the future to support it. Obviously, there is a great probability that the company cannot continue to maintain high growth. Once the company's performance does not meet the standard, the stock price will plummet, and they will suffer heavy losses.III. It is essential to engage in asset allocation, focusing on low-risk assets such as bonds and money market funds, rather than investing all funds in the stock market. Additionally, one should have a global perspective and consider investing in the stock markets of other countries. Taking this year as an example, those who invested entirely in A-shares have suffered significant losses to their personal assets. In contrast, those who diversified their assets, including savings and money market funds, or had some foreign investments, experienced relatively lighter losses. This is a form of protection for one's principal.

IV. One should create a stock investment portfolio, avoiding the use of leverage and all-in bets.

Using leverage, heavily investing in, or making all-in bets on a single stock exposes one's principal to the risk of black swan events. In the event of an unexpected occurrence, significant losses can be incurred. All those who suffered heavy losses did so because they concentrated their funds in a single investment. The most responsible attitude towards one's principal is to not put all eggs in one basket.

V. It is crucial to monitor the fundamentals of the stocks you hold and to cut losses in a timely manner if there are significant issues.

Under the safe protection of asset allocation and stock portfolio management, if one discovers significant issues with the fundamentals of the stocks they hold, they should cut their losses promptly to prevent the risk from expanding and further eroding their principal.

The most terrifying aspect of stock investment is the significant loss of principal. Once a substantial loss occurs, it may take investors many years to recover, and some investors may even leave the market permanently due to excessive losses.