Glossary
Plain-language, bilingual definitions of investing terms.
QQQI (Nasdaq High-Income ETF) and the Truth About Return of Capital
QQQI is a high-income ETF generating monthly distributions (~1%/month) from the Nasdaq-100 plus covered calls. But its distributions aren't all dividends — part is return of capital, part long-term capital gains; the true dividend portion may be only ~5%. Tax impact is minimal for Taiwan investors; US investors must watch cost-basis erosion.
Savings/Life Insurance Isn't Investing: 16 Years for a 0.64% Return
A student's husband paid life insurance for 16 years at NT$120k/year; the agent claimed '4.5% simple interest is great' — the real compound return was just 0.64%, below a savings account. CLEC's stance: keep insurance and investing separate; don't treat savings insurance as investing.
Beta (with QQQ = 1.0 as the Benchmark)
CLEC uses QQQ as the Beta 1.0 benchmark (not SPY). QLD (2×) = 2.0, TQQQ (3×) = 3.0, cash = 0.0. Multiply each asset's beta by its weight and sum to get your whole portfolio's beta.
Pledged Loans (Pledge) vs. Margin
Pledging means borrowing cheaply against your assets to live on while never selling your stocks; margin is high-risk leverage the broker can force-liquidate. CLEC supports pledging and rejects all margin — because margin forces you to sell at the bottom.
ROA / ROE / ROI: Don't Fall for the "Return Rate" Sales Pitch
The same investment yields wildly different "return rates" depending on the denominator. ROA = profit ÷ total assets; ROE = profit ÷ your own equity (borrowing amplifies it); ROI = profit ÷ the amount actually invested. Speculators love quoting only ROI (put in NT$100k, made NT$30k = 30%), but you should ask for ROE. Buffett: ROE is the money you actually earned.
Bonds Aren't the Safe Asset You Think: Why CLEC Doesn't Buy Long or Corporate Bonds
Most people think "if you fear volatility, add some bonds." CLEC takes the opposite view: long-term Treasuries and corporate-bond funds are high-risk — they can fall harder than the index, rise slower than the index, and deliver low long-run returns. Only short-term bonds are cash-equivalent; treating long bonds as a safe asset puts something you think is safe, but which actually drops hard, into your portfolio.
Index Fund
No stock-picking, no market-timing — you own a basket of the whole market. Low-cost, diversified, long-term: the core tool of the CLEC philosophy.