Category Archives: Applied Finance

Approach

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Hey,

Just did a mental review about my approach to the markets over the years.

Saw how I started out.

What was the motivation?

Strategy?

Mindset?

Outcome?

Then gauged these parameters after being in the markets for ten years.

And, finally, assessed the same as of today, after being in the markets for twenty years.

Here are a few observations.

Approach softened over the years.

Not in quantity. Will come to that in a bit.

No, approach became opportunity-linked.

One didn’t wish that the markets would be somewhere.

One played them where they were, as was worthy of that situation.

One wasn’t tense.

One had rules. Approach was now rule-based.

One enjoyed the approach.

It was relaxing.

It now gave a kick.

Now, there was feeling of achievement.

Of creation.

Of success.

Earlier, all this wasn’t there.

One was tense most of the time.

One followed markets all the time.

Sometimes, sleep eluded.

Now, after market hours, what market? When you don’t think about it, it doesn’t exist, for you.

I’d said I would mention quantity, which has been increasing steadily, since it’s a function of portfolio-size.

So, in a nutshell, benefits abound, upon ever-increasing quantity?

What’s happened?

What’s changed?

Have gotten into a groove.

Found a sweet-spot.

Entered a zone. The Zone, perhaps.

It’s like that ‘perfect’ cover drive, or an optimal trajectory golf drive shot resulting in a birdie for the hole. Don’t wish to use ‘hole-in-one’ here, that would be too much… .

In the Zone, you know things.

Someone outside the Zone will ask how one knows.

Don’t know. One just knows.

One can attach oneself to the swing of the Universe.

One is one with the swing.

It takes time to get into the groove.

For me, make that twenty years.

One becomes mouldable, and flows with the current of the Zone.

I enjoy my approach.

It’s not tangible.

Visibility is not my criterion.

What is, then?

Fulfilment.

If my approach is all I have when I die, I’ll leave with a feeling of fulfilment.

Wires

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In a one-liner…

…the ‘magic’ formula…

…to crack the market would be to…

…’buy low, sell high’.

Reading this line in a normal mental condition, it is natural for us to say…

…’oh, so simple?!!’

That’s just it.

Cracking Mrs. Market is a ‘simple’ process… … … .

However,…

…the question that screams for our attention is…

…’pray who is in a normal mental condition?’

And the answer is this.

When it counts, almost no one.

When does it count?

At lows and highs.

At lows we are in a frenzy. Panic. ‘Blood’. No one considers buying, even remotely. Those who want to, and would have, are not liquid. Exceptions take the plunge.

At highs, we are exuberant. We know it all. We are the kings. Please don’t tell us to sell. We’re not selling. ‘Hubris’. Those who want to sell, and would have sold, are told irrefutably by family members to forget about even thinking of selling. Exceptions ward off the pressure and make the sale.

We want to be those exceptions.

How do we get there?

It’s about wiring.

Our normal wiring makes us act normally, in a manner where big profits can’t be made.

We need to rewire.

We need to be uncomfortable when markets rise, uncomfortable enough to at least take our principals out. During lows, we need to find comfort in the very idea of entering, thus redeploying our freed-up principals.

How does one rewire?

By being in the market…

…small…

…for long…

…learning to lose small…

…and to win big by letting profits run.

Perhaps very big, over time, by allowing one’s cost-free-ness to remain in the market for a very long hold.

Opportunity

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Knock knock.

Nobody home.

See you, bye. Maybe never.

Knock knock.

Come in.

This is the requirement.

No funds.

Bye.

Knock knock.

Hey. Funds not a problem.

Guts?

What if I lose?

Bye.

Knock knock.

I wish to invest and the risk is digestible.

Ok. Pull the trigger.

Should we wait for a better price?

Bye.

Knock knock.

Let’s pull the trigger.

Ok.

There.

Bye.

Hey, it’s been a month and I’m up 10%. Let’s cash out.

Ok. Bye.

Knock knock.

This time I’ll let my profit run. The last one doubled in 6 months, but I’d cashed out after a minuscule rise.

So you’ve learnt how to sit?

I keep a lookout for you. If I’m not home I get alerted to your presence, so that I can act in time.

Then, I always maintain ample liquidity for you.

The amounts I put in make my risk digestible, looking at the total size of my portfolio and liquidity.

Once you knock, I’m not afraid to pull the trigger anymore.

I’ve learnt to let multibaggers develop. I don’t nip them in the bud anymore.

Wonderful. Now add cost-free-ness to your repertoire.

Why?

It’ll trick your mind into holding your multibagger eternally, so that it is given the chance of becoming a megabagger.

Will do, thanks, cost-free-ness won’t cost me anything, right?

Not a penny.

2050

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Hey,

There’s a Street View… ,

… , and then there’s a street view.

I rely on…

…my street view.

Making it a point not to heed that the Street thinks, I repeatedly look for micro and macro signs on my street.

My street is where I am.

I mostly spend my time in my own country.

And, my street view is one of staggered growth.

There’s development…

…with holdups waiting to happen out of nowhere, and often.

That’s India, for me.

Am I going to cry?

I scream, actually, at apathy prevailing, but from the inside. To no avail. At one point the screaming stops. The only thing remains is to take advantage. I’ll make it up for India. Part of the money earned will go towards a private initiative towards my country’s development. So, no guilty-conscience here. My country gives me repeated opportunities. Why should I not take them? India does give me grief too. It’s ok. I love my country. We both can take liberties with each other, as do parents and children between themselves.

Owing to our attitudinal coordinates, our country is full of bottlenecks, and these bring a rising entity down, regularly.

Apart from that we’re emotional.

Over-emotional, actually.

So what’s going down goes down by an unhealthy multiple.

Activation.

Chart Pattern?

Numbers talking to you?

Method.

System development.

Pinpoint.

Enter.

Sizably.

Making size a function of portfolio magnitude.

When something here rises, one lets it ride with a stop that eventually triggers, then trails.

One never books a winner fully in India. Not in this bull market.

Billion dollar strategy.

One first goes cost-free.

And then some.

After one’s in-the-profit stop is triggered and then hit, one takes one’s principal out, with which one will fight the next battle, the next quest for cost-free-ness.

One leaves one’s cost-free-ness created on the table and shifts if out of sight and out of mind.

One’s cost-free-ness can be held for a long, long time.

Till 2050?

Yes, if the underlying has been duly whetted for a 2050 hold.

That’s how we play India.

Till 2050.

Throw-Offs

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Hey.

Stumbled upon a concept.

Calling it the throw-off, and…

…sharing it with you.

How many times have you booked too early?

Booked late?

Gotten in early?

Late?

Not risen to required action?

Made a bad decision?

Lost faith in the market?

In yourself?

These are results of throw-offs.

Something has thrown you off your game.

This something is the ongoing market action at the time.

Action has been such, that it has thrown one off one’s track.

It’s not your fault. Action is such.

Price hits a stop, for eg. You take the stop. Price resumes in same direction.

Price hits a target. You get out. Price resumes.

Price falls just short of the stop, resuming. You double down. Price then breaches stop and a down-trend starts.

Price shoots past target, not giving you time to act. You then define a new target. Price nose-dives beneath old target, just as fast, eating up a good portion of your original profits.

Examples can be many. Common factor is market action throwing you off your profits, or throwing you out in loss.

Where do we stand?

Is this cause for alarm?

Is there something we can do about it?

First up, market action is a sum resultant of all market behaviour put together, and is perhaps impossible to defy. Our pockets are not deep enough by miles.

We don’t fight market action.

We use it.

Yes, since we can’t defy it as such, we make it work for us. Also, if market action alarms you, do something else which doesn’t. That’s where we stand.

It’s ok to be thrown off while following one’s trading plan.

It’s not ok to be thrown off, having been psyched into altering one’s trading plan mid-trade.

Meaning that it’s not ok to book below target owing to adverse market action above one’s stop.

Also, when a trade is going against us, again, it’s not ok to exit owing to adverse market action above one’s defined stop.

One exits at stops, not above. Sticking to this one rule will nullify throw-offs above stops. Defining is easy. Doing is difficult. Over time, with practice, we define and do. Period.

Now we tackle targets.

How do we knock-out throw-offs here?

Another day, another defining rule… 🙂 … .

Don’t exit at targets.

If you don’t exit at targets, no one can throw you off before a target.

Ok, so what’s the exit strategy whilst in profit?

Have a target.

When it comes, it triggers your stop into existence, which you have defined x% below this target.

So, we now stop using the word target. We use ‘trigger’ instead.

In other words, your stop gets activated, or triggered into existence, once a certain profit-threshold is crossed.

This stop, which has just come alive, is dynamic in nature, towards the profit-side only.

It moves in the same direction as the price, in a proportion defined by you.

As price keeps moving, your stops keeps locking in more and more profit.

You’ve knocked out the throw-off, since your exit is completely rule based, and no one else knows the parameters (numbers) you are feeding in for exit.

Eventually, price action makes you exit rule-based, when price reverses above the ‘trigger’ and hits your dynamic stop. Market action hasn’t succeeded in throwing you off your game.

Notice one thing?

You’ve been in control of your trade all along.

Your head is sane, your emotions are stable. You have set yourself up to take some very profitable decisions.

Wishing for you lots of profits…

… 🙂

.

Beta

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We’re not afraid…

…of beta.

In fact, we want beta to be there.

And, we want it to be big.

Beta is part of wealth-generation through cost-free-ness.

Why…

…are we not afraid of beta?

When we make an underlying cost-free, there are two parameters that are of prime importance, in the game that we are playing.

First up, speed of cost-free-ness.

How much time has it take us to reach the desired stage?

Too much time?

Work at the strategy.

Short time?

Great.

With large betas, we take lesser time to reach cost-free-ness.

Cost-free-ness is a state of mind.

Also, it is a function of parameters prevailing.

As a result of internal synthesis, we know in our mind when it’s time for cost-free-ness creation.

Once cost-free-ness is created, we move on to the next play with the same objective.

Next up, we have quantum of cost-free-ness created, per capita time.

Higher the quantum, in lesser time, why, that’s optimal.

Again big beta.

Without big beta, there’s not much chance of achieving large quantum in less time.

How do we exploit big beta to attain objective?

Get in on huge margin of safety. Get principal out when exuberance prevails. Scrips being played are those of which you are convinced. Meaning, that you are mentally in sync with very long-term holds of cost-free-ness created in these scrips.

Also…

…as a general game-enhancing practice…

…get in and out with multi-day or multi-month triggers. Don’t look at the markets while they’re on. Take emotion out of play. Nil market forces out of your equation.

Here one sees, how, amongst other factors, a big beta allows one to generate long-term wealth through cost-free-ness while…

…acting on one’s own terms.

Banana Trajectory

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Growth …

… is a non-linear entity.

Especially…

… high growth.

Amongst many things, …

… one point needs …

… pointing out.

Between periods of high growth…

… anything can happen.

The levels of what can happen are, amongst other correlations, directly proportionate to the number of similarities between an economy in question and the functioning of a proper banana republic.

Freedom of speech can be suppressed.

Parallel economies can thrive.

Extortion and blackmail can rule.

Genocide.

Landgrab.

Terrorism.

People buyouts.

Apathy.

Dysfunctionality.

And then there’s high growth again, perhaps soon, if the economy gets its act together despite its rulers, and perhaps accelerated, if the rulers come to their senses and return back to being peace, growth and democracy loving .

Without getting into what kind of a republic we live in, for lack of a better phrase, and with a very small use of one’s imagination, one could venture to suggest that our own path of growth could resemble that of a banana trajectory.

The banana in this title doesn’t have much to do with the curvature of the fruit.

Much rather, it’s about the economy to banana republic correlation.

Might I suggest that our economy’s banana behaviour is mostly mild. Then, rarely, it gets intense. Normal growth returns. Then comes high growth. Periods of very high growth are rare, but there too.

Overall I’m happy with my and in my republic.

Sometimes, its banana behaviour beats me up.

Yeah, every ten years or so, there’s a big hit.

No one likes getting hurt.

I do remember to stand up and continue fighting, …

… because it is in this very republic, that I can make my 15% p.a.c.

On the conservative side, that is. Perhaps I can make more.

I don’t get that in any other economy.

You see, occasional banana behaviour is good news for a long term contrarian.

Banananomics lead to blunders, and temporary downfalls, with all indices falling big.

Which is where we have the guts to buy, and big.

Why?

We know we are on a high growth trajectory with intermittent banana behaviour.

A very simple formula suggests itself.

Buy big during reactions to banana behaviour.

Take principle out after spurts of high growth.

Sit tight on underlying in profit, perhaps for life.

A high growth trajectory with intermittent banana behaviour will give you many such cycles in your lifetime.

One stands to make multiple times the ten-yearly hits.

Upon recognising this recurring pattern, one can even fine-tune and enhance loss-attenuation.

🙂

Hack

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Farm-land?

Own it?

Yes?

If so, you can avail an overdraft on your fixed deposits, having to pay low interest.

Why?

Government allows farmers to take crop-loans.

If you own farm-land, well, you are a farmer.

Even if you don’t use the facility to buy crops, you can still use it…

… for whatever.

Perk.

Government sops it to farmers and you get roped in as an accidental farmer.

G(ood) f(or) y(ou). Yeah, gfy.

Why overdraft?

So that a fixed deposit doesn’t need to be broken prematurely.

Why the trouble?

Let’s say you need trade money to be in a trade for a few days, but the bulk of your liquidity is working elsewhere. However, in good times, you have created fixed deposits, which add to your liquidity at regular intervals. When your liquidity runs out for a few days, you think of breaking an FD to replenish it, but this incurs a penalty.

Suggested hack keeps everything intact.

You utilize the created liquidity, let’s say for a month.

Meanwhile, your income pipeline generates new income. You use this to keep nullifying parts of the loan. Let’s say in 40 days you have nullified the loan, and your positional trade, for which you took the loan, is still on. You are charged low interest on the loan taken for 40 days. Now the loan is nullified. Position is on and yielding. All equations solved. Net net something created out of …

…s omething that was already utilized elsewhere.

It doesn’t necessarily turn out so good all the time with a position, though.

If it’s losing, you are suffering positional loss and interest payment loss simultaneously. That’s the downside.

This hack is worthy, nevertheless.

Interest charged on 40 days is a small figure, typically less than a percent. A positional trade in profit can well give 15%+ in that period.

So, hack stands.

All you need to do is to see if the hack fits you.

Process

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In the markets…

… actions are decisions.

No decision taken means no action.

Well, no action is also an action.

Ok.

However…

… eventually …

… to generate wealth …

… or income …

… we are confronted with decisions.

I’m not afraid to act, upon seeing a confluence of supportive indications.

If I were afraid to act, well, I could have just sheer chosen another line, but would have been confronted with the same deficiency, there too.

Acting upon enhanced win probability should do away with any fear.

However, there’s always that thing before trigger-press.

What if I’m wrong?

Let’s not be afraid of being wrong.

We’ll take our stop and then we’re done with this action, now looking at implementing another action.

Our ability to take the decision for this other action, and for all future actions should remain intact.

How do we ensure that?

When we’re wrong, let’s be wrong small.

Then let’s move on to whatever new action is coming our way.

If we let ourselves be wrong big, that, my friends, is crippling.

Let’s not cripple ourselves.

Crippling does away with the capability to act further.

Now, decisions are a fry cry.

The day becomes heavy.

Nights …

… well …

… sleepless.

That’s not going to happen to us.

Why?

As traders, will do everything in our capability to stop a big loss from happening.

How?

Losses are small in the beginning.

Let’s define their limit.

If you want to take it trade by trade, fine. Each trade has its own dynamics. However, small nature of stop remains common. Define what is small for you.

How?

My formula – anything that stops the day from becoming heavy and the night from becoming sleepless. For me, that’s small. You decide your formula. Whatever works for you, take it.

This is called process.

We follow process.

We don’t focus on profit and loss.

We focus on process.

We want to get our process correct, day in, day out, forever.

Losses will follow. They will be taken small.

Profits will follow. We will allow these to become big. Though that is a difficult one, we will need to learn to, because without this one thing working for us, we won’t be long-term profitable.

Here’s a formula regarding letting profits run.

After a profit has touched 3 x your stop, allow 50% breathing space. If this is squeezed completely, exit with small profit. If underlying inches higher, inch your stop upwards, always allowing for breathing space. At 4 x you can allow 40% breathing space, at 5x 30%. Etc. Make your own formula that allows profits to burgeon.

Wishing you lucrative trading and ample wealth creation!

🙂

Pipelines

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Replicability of an approach is a pipeline. You can always draw on it for a fresh trade, for example.

Scalability is a pipeline getting broader.

Research sharpens the edges of your pipeline, sustains these well, and founds new paths (pipelines), going forward.

Deep Thought is where one taps the pipelines of the Universe.

Experience builds reflexes, which guard and enhance pipelines. This is intuition in action.

Ability to discern allows judgement to manipulate a pipeline in the correct direction.

Cataloguing provides hindsight, so that the pipeline of foresight is strengthened.

Giving opens up vast positive pipelines for oneself, by creating energy vacuum in one’s immediate environment.

Relaxation allows the pipeline of genius to emerge. Brilliant sparks which have been developing silently, within oneself, burst forward.

Family is a pipeline of joy.

Freedom allows the pipeline of creativity to flow.

Also, detachment allows time for the pipeline of flow to form properly. This is particularly valid in trading. Think of profits being allowed to run, for starters.

If I rack my brains, I’ll come up with more…

…pipelines.

That’s not the point.

The point is to delineate that one’s per saldo self is a net resultant of many pipelines acting in tandem.

These have taken time, effort, fortune, patience, blood, sweat, tears and what have you to create.

I measure my life’s success in seamlessly implemented pipelines on autopilot.

For every long-term, seamless, auto-pipeline functioning optimally and on full, there have probably been fifty discarded efforts.

Whether one is trading, investing or sheerly living a fulfilling life, …

… it’s one ‘s pipelines that provide critical support.

Approach

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Markets speak.

Can we hear them?

Do we know their language?

We are not born knowing their language.

We learn.

Their’s is not a normal language.

It keeps changing…

…till it’s similar to the past…

…and then it changes again…

…to throw us off-track.

We need to keep adapting.

Every corner could be a new one, with a new sign.

Feel the challenge?

The thrill upon attempting to decipher?

Do you feel fulfilled?

Well, if yes, then you’ve met your calling.

Congratulations.

Now sustain.

Play out your full market journey. Enjoy it. Win.

How?

Since every corner could be a new one, every corner needs to be approached with a what-if-plan.

Simultaneously, one is on the lookout for signs.

What signs?

Similarities, in patterns, psychology, chronology, feel, levels, anything.

Have you seen this before?

What happened last time?

Approach with multiple scenario what-if.

What if you haven’t seen current signs on offer?

Carve out the situation.

Create scenarios.

Build a what if for each scenario.

Approach.

Notice something?

Whether one has seen something before, or not, the approach is basically the same.

Great.

We’ll not bother with getting spooked out.

We just keep tapping the markets, armed with a play-out strategy for each unfolding scenario.

Our approach is designed such that we sustain till the end of our market journey and beyond.

We keep intact our health, family life, and our corpus.

We keep sharpening our edge, and keep attempting lucrative reward risk scenarios.

We learn to take our stop.

We learn to let runners run till logical exits appear.

We learn to establish and enjoy a life beyond markets.

Wishing all market success and happiness.

🙂

Shareware – When Everyone has Access

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Hmmmm…

…what is…

…and what isn’t?

Is technical analysis 1.0.1 still valid?

Why has this question arisen?

What is it about shareware?

Basics never go away.

One always falls back to basics.

Having said that, basics can be made to appear a certain way.

Why?

So that a newbie recognizes a pattern and acts.

Does that render the shareware useless?

NO.

One learns how to use shareware.

Combining a basic candlestick pattern with volume and open interest, for example…

…renders the shareware back as useful.

However, we are now moving in the sphere of technical analysis 1.0.2+ .

Moral of the story?

Don’t believe what basic shareware is telling you as is.

Back up your observation with multiple factors.

Aligning combinations?

Sector behaviour?

Broader market?

Market rhythm?

Cycle?

Domestic sentiment?

International what have we-s?

Psychology at play?

Get a feel for the goings-on.

It’s ok to pay for market software and set it up with multiple edges, rather than use plain vanilla free- or shareware.

Why?

Edges…

…translate into money.

Even an alert is an edge.

20 alerts are 20 edges.

Freeware not allowing any alerts?

Well, rethink, Mr. Scrooge.

Spend on quality, to make multiples later.

Let’s get out of the freebie mentality…

…since we wish to strike it big with the markets.

Wishing all lucrative market play!

🙂

SystemPower

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Life moves…

…from system to system.

We add value…

…at every step.

One breathes easy after setting a system on auto.

While setting the system on auto, it’s the process that drives us (Neo).

Process gives quality to life. Enjoyment emanates.

It’s this enjoyment that we carry forward. Rest, all of it, stays behind. This enjoyment, and the memory of it, is our earning that lasts, eons.

Systems can be applied to all walks of wife.

Deciding not to have a system in an aspect of life…

…is also a system.

Why?

You decide to…

…not do something…

…if a particular situation arises.

Keyword is…

…’decide’.

The more important questions here are…

…whether you have stuck to your system?

Did you refrain from acting?

Did sticking to process evolve you?

Were you thrown out of your comfort zone?

Did you enjoy getting tossed around?

Sometimes we do. It teaches and equips us for bigger game. We enjoy exploits in the bigger game after having learnt from the turmoil in the smaller game.

Whatever cooks your recipe.

Permute…

…combine…

…and devise…

…the optimal chronology for yourself.

Yeah, optimize the system…

…and don’t stop optimizing…

till you’re ready to leave such system on auto.

Wonderful.

You now have so much confidence in your newly fully optimized system, that you actually leave it functioning on auto, and move on to use your life to keep adding further value.

Eventually, life becomes an ensemble of powerful systems.

Remember, some of these are no action systems too, so you’ve got that base covered, yeah, this line was for the critics 🙂

Occasionally, systems malfunction.

Then, we fine-tune.

Or, we discard, and create anew.

The power at your disposal when a system functions successfully, on full and on auto, is immense.

Imagine a life with multiple successful systems functioning on full, and on auto.

Apart from all the pluses that emerge in such a life, there’s something I wish to focus on.

Systems on auto means spare time after achievement.

Using this time to do something even more meaningful is what attracts me.

Eventually, all the value addition starts to benefit not only you but also the people in your environment, your city, your country, and…

…the entire world.

🙂

Harness

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Market forces are like Wifi.

When we connect to them, they…

…connect to us.

When we’re indifferent, …

… we’re in a different world.

When we create systems, and put them on auto-pilot, we mostly do away with the ability of market forces to act upon us.

A successfully implemented system on auto-loop is like making time stand still.

That’s our goal; that’s where we want to be.

In the act of getting there, we are subject to compelling market forces.

How do we deal with them?

Rather than suffering KOs from their punches, we devise systems…

…to absorb their blows,…

…understand the implications of these,…

…to, then,…

…harness them.

What am I talking about?

Why give market forces so much power?

Why not?

They’re there, right?

In abundance, too.

Why not use them?

How?

You can go back to George Soros’s back pain for starters.

Have you developed such physical systems?

I’ll tell you what I implement. It’s a me thing. You’ll need to develop your you thing. I’ll share with you my me thing, though.

When markets are down, I do feel bad, it’s an initial reaction. I wait for it to intensify. I wait for myself to feel awful. That means markets must be really down. As awfulness rises, I start buying. When awfulness is uncontrollable, I buy big. When it makes me puke, I buy maximum. Meanwhile, I’ve rewired my nervous system to accept the awfulness as a marker for buying, and I’m not sad that I’m feeling awful during market crashes. Hmmm, I know it sounds a bit crazy, but this a successful harness-methodology of otherwise overwhelming market forces.

When markets are up, I feel buoyant. Earlier, when I felt buoyant, I used to buy more. Now, I do nothing. Market-nothing, that is. Non-market, I’ll do many things. That’s harnessing buoyancy. As markets rise further, I do even more of market-nothing, and when I can’t control it, I then start creating cost-free-ness. When buoyancy is uncontrollable, I create maximum possible cost-free-ness, and hopefully, then, I can go on market-vacation. Before I do that, I make sure to transfer the cost-free-ness created to a dedicated holding platform for my cost-free-ness.

Ideally, new market activity needs to only commence upon the next set of opportunities. Sometimes, one needs to wait long for these to develop. The act of bridging time comes in handy here. Market is not giving action. We harness even that. We have accumulated lots of pending tasks, just for this kind of period. Now, we do these. Ultimately, an opportunity arises. A new cycle of cost-free-ness-creation starts.

Development of you-unique systems helps you harness the market in a winning fashion.

Wishing you lucrative investing and lots of cost-free-ness!

🙂

Making Time Stand Still

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The buck stops…

…with the entity called time.

Too much hangs on it.

Lack of it makes decisions difficult.

Too much of it defers them.

In the markets, we take it out of the equation…

…and then act.

If not, market forces bog us down.

And, imagine the load if our game is heavy.

After having gotten our basics infallibly into place, we wish to play a heavy game, without the load.

Hence,…

… – time – …

…first we take out of the equation,…

…and then we play.

We stretch the trade duration to a potential infinity. Period.

Trade might resolve in a few days. Or not. Right.

However, potential infinity gives us the wherewithal to focus on the next play.

Then, before action, we make time stand still.

How?

By forgetting that it exists.

By focusing on the one act that we are about to commit.

By encompassing the totality of all connectivities that have led us to the moment of acting, and having them before our mind and on our fingertips, as we act.

By being pinpointedly mindful of our actions whilst shutting out any disturbing noise.

By being…

…in the Zone,…

…such that,…

physically,…

…time might tick,…

…but for us it doesn’t seem to.

And…

…why?

Why are we so interested in making time stand still as we act?

For just one pure reason.

We want our act to have maximum impact.

And that it will, once we act, immersed in the scheme of things.

The chronology is as follows : Time still-stand, identification of market act, entry into scheme of things, action, exit from scheme, time roll-forward.

Timeframe doesn’t register in our minds. Potent action is identified, and happens, fitting into the natural fabric of things, into the timeline of the scheme of events.

Impact, ideally, is maximum.

Imagine the cumulative impact of a lifetime of such actions!

Wishing you lucrative times!

🙂

Tech Bubble please burst

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Bubbles burst,…

…like,…

…pendulums swing.

We’ve seen bursts.

We’ve gauged our way through them.

Lucratively.

Why?

We save up…

…for such situations.

Earlier, bursts were rare.

Now, they are common…

…and quick.

That’s great news for us.

What’s the worst that can happen in a tech-bubble burst?

Front-liners can start trading at single-digit valuations.

Mid-tiers can be down 50 to 75%.

Smaller players can lose 90% of their market cap.

When front-liners trade at single digit valuations, we’ll load up on these.

Medium sized tech scrips showed even ten-bagger behaviour lately. Such down-side would be immensely valuable for us, to avail re-entry opportunities.

Coming to small-sized, debt-free tech players with remarkable free cash-flow to market cap ratios, ya, we do own a couple, and ya, we would re-buy.

So, what’s all the hoo-hah?

Bubble bursts, we buy.

Strategy is outlined.

Players are demarcated.

No time for small-talk, chit-chat, or any other non-useful “market-activity”.

Meanwhile, we just keep trading from interim low to interim high in our pursuit for small quanta of cost-free-ness.

Period.

🙂

News from the One-Off Corner

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One-off runners emit a lure.

One don’t follow them.

However, one is dazzled by their move, and gets roped in.

What’s the out?

1). Emo-check.

2). Fundamental scrutiny.

Pass or fail.

If pass, go to 3). (if fail, move on in life).

3). Add to watch-list.

4). Watch.

Keep watching…

..till you can take a decision to make the one-off a static, or you just junk the idea of engaging with the one-off.

There’s that word again – static.

It’s possible that I’ll be laughed at for using this word in a market context.

I don’t mind being laughed at.

Others have been laughed at too.

Some of these are called pioneers today.

I’m not saying that I’m one.

However, I like to do things differently, exploring new avenues. It just sheer gives me a kick.

News from the one-off corner is their ability to showcase capability of movement.

You see, we’d like our statics to be able to move freely when the time comes.

When we see a one-off exhibiting free movement readily, we can explore whether this one can one day become part of our statics.

To build a house, one needs bricks.

As long as we desist from trading one-offs upon first movement and without proper fundamental and watch-list scrutiny, we should be safe.

When we convert the one-off into a static, news from the one-off corner translates for us into multiple wins over time.

Wishing you lucrative times in the markets!

🙂

Statics

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What are your statics?

What do you follow …

… all the time?

More importantly,…

…why follow something…

…all the time?

There are always new runners on the block.

Changing pursuits regularly should keep one busy, right?

Right.

Busy.

Busy winning?

Not so sure on that one.

Statics allow you to win through them…

…again and again.

Why?

Because you have felt their pulse.

Your fluidity has blended into their being, and you are one with the underlying.

You flow with them.

That’s when you win with them.

Ya…

…that’s when you keep winning with them.

How did you choose your statics?

Choice needs to be fool-proof for you.

Why?

If not, doubt will creep in.

That’s a poisonous crack.

It doesn’t allow you to win with your static.

Replace the static in question, this time without a doubt clouding your mind.

Or, bury your doubt.

Then, go and win.

Statics, is that even a word?

No idea.

It feels right, and I’m using it to channel across a pivotal concept.

That’s all that counts.

🙂

Fearlessness

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Hey, 

There’s no hype…

…on Magic Bull.

No business lunches.

Conferences.

Fees.

Advertising.

Liasoning.

Roadshows.

Magic Bull is a no-nonsense, cut-to-the-chase space.

Why?

That’s how I like it.

A strategy that works under any market conditions, …

… is multi-faceted,…

…  adaptable, …

…  self-adjusting, …

… and comprehensive, …

… doesn’t require artificial crutches… 

… because, …

… it makes…

… money …

… on its own.  

Why is the Magic Bull approach successful in any market, under any conditions?

Because it is based on fearlessness. 

We are not born fearless.

Fear is a natural human instinct innate in us. 

It saves us, many a time. 

However, to make money in the markets, one needs to get rid of fear.

How?

Most of our planning revolves around creating circumstances around ourselves that take fear out of the equation. 

You’ll need to make the effort of going through the material in this space, to get a grip on how Magic Bull eliminates this emotion. 

You see, even if there’s a free lunch in life, it’s not that free that the spoon will lift itself and put the meal down another’s throat. 

A certain minimal effort will need to be made. 

Thing is, hardly anyone makes even that kind of effort. 

Result will be, that not more than a handful will actually read this stuff, and one or two might actually implement it.

Sure. 

Growing Magic Bull’s readership is not my objective.

What do I get from the entire exercise?

Evolution. Writing evolves. The strategy just gets better and better.

Blah blah blah. 

Oh, ya, what happens when a strategy gets it right?

I’ll leave you to figure that out, since that’s what I get. 

And why again?

Because of fearlessness.

One’s cycle of winning in the markets, under any conditions, starts with fearlessness.

Wishing you fearless trading and investing!

🙂

Banking on Infinity

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In a market…

…that promises decent…

…long-term growth, …

… we are able to…

…bank on infinity.

In such a market, the concept of cost-free-ness proves successful …

… in that it is able to generate multibagger outcomes, …

… over the very long-term. 

In such a market, the power of compounding makes itself felt in its full glory.

Also, in such a market, fear goes out the window for the clued-in player, since one is able to…

…bank on infinity.

We are fortunate to be playing in one such market. 

Yes, one such market is our very own. 

Having said that, India has idiosyncrasies, as does every market, and the Indian angle on these is definitely unique. 

The main one is that we’re an emotional lot. 

That is automatically then reflected in our market too. 

High beta. 

Meaning, in normal English, that there will abound huge entry opportunities, and huge exit opportunities, on a regular basis. 

And that, if I may underline, is worth Gold for us in the pursuit of cost-free-ness.

In other words, we will be able to create cost-free-ness year upon year, month upon month, and, at times, like now…

…week upon week.

Is that not…

…wonderful!

Once cost-free-ness is created, we transfer it out of sight, and, banking on infinity, we can just sheer forget about it, focusing our attention on the next round of cost-free-ness-creation.

We can do that because we are in the right type of market for this particular model. 

In fact, this model has been conceptualised for exactly…

…this market. 

Maybe someone has done it before me. Perhaps a lot of people. More successful. Big players. Famous. And that’s huge. I’m happy for them.

However, that’s not the point. 

We’re not in this for the glory of who got there first.

We’re in this for generating long-term wealth by using the concept to the hilt, because it’s working, and promises to do so till into the far-foreseeable future.

Before I sign off for now, there’s one more thing to remember. 

When we bank on infinity, we most hold before our eyes, that the translation of long-term growth into long-term wealth…

…is not linear.

Growth is perceived in spurts of optimism spilling into over-optimism, and these become our exit opportunities, where we exit with our principals, and are left with stacks of cost-free-ness. 

During spurts of pessimism, spilling into sheer depression, prices dip low enough, such that we, once again, get representable entries. 

It’s a neat little cycle that has been playing out since markets started. 

In our own market, this cycle allows us to generate cost-free-ness, again and again, while banking on infinity.