Many people live by the mantra: To invest, you must use leverage.
They believe that since money loses value over time, borrowing someone else’s money today means paying back less in real terms—essentially making a profit.
But the reality is this: even assets that seem to be in a permanent bull market have left countless individuals with heavy losses. These people are usually the silent majority; they do not speak up.
Even within a long-term bull market, and even when an asset is in an upward trend over the medium term, there will still be short-term downturns whose length is impossible to predict.
Some say, “Simple: just hold on forever.”
The problem is, even if you pick the right asset, if your investment capital has a repayment deadline, a temporary downturn will put you under dual pressure: the approaching deadline and fear of further losses. You will likely convince yourself the asset is failing, sell in a panic, and lock in a loss. This irrational behavior is one of the most common causes of investor failure.
Therefore, money used for investing should, as much as possible, have no repayment deadline.
Such funds fall into two categories: your own money, and money given to you (not lent to you).
1. Your own money
Investing with your own capital, without leverage, allows you to think rationally and objectively. This greatly increases your chance of surviving multiple market cycles and achieving real long-term returns.
Does that mean we should never borrow to invest, not even for a mortgage?
Of course not.
“Your own money” includes not just what you have now, but also income you are certain to earn in the future.
If you have a stable, reliable income—such as a government employee—borrowing within reasonable limits is simply drawing on your future earnings, which are still your money. Such “advance use” can even motivate you to earn more, since people have great potential but also laziness.
Even when you are drawing on your own future income, you must always account for the cost.
2. Other people’s money
Using other people’s money does not mean borrowing it—it means shifting the risk to others while keeping a share of the profits.
Most financial advisors and wealth managers (even some famous names on Wall Street) are not great investors. They are salespeople.
They memorize scripts, use jargon ordinary people do not understand, and persuade others to entrust them with capital. They bear little downside risk, but take a cut of any gains, profiting simply from bull markets.
Their wealth rarely comes from their own investing skill—it comes from management fees and performance commissions.
This is an advanced strategy, not for everyone.
You must first prove yourself with your own capital, over full market cycles: showing you have superior insight and can consistently outperform others. Only then can you earn trust, build influence, and ethically use this approach. #FogoChain $FOGO @Fogo Official