Category Archives: Belief

Moving away from the Greeks

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I’ve never been to Greece.

I have nothing against people from Greece.

I don’t like Greeks, though.

Yeah, I’m an options player.

The Greeks I don’t like are options Greeks, he he he…!

What, you thought I didn’t like actual Greeks?

Come on, I’m sure I’ll love Greece and actual Greeks!

When you don’t like something, you can try to go around it.

I don’t need options Greeks to play options. I’ve found a way around the Greeks.

I’m sure others have discovered this too, because truth is truth.

Let me tell you about it.

You’re buying in the direction of the long-term trend.

You’re buying (calls / puts) after a significant correction / rally level has been hit.

You’re buying post a small move in the direction of the long-term trend, after the correction / rally level has been hit.

You’re buying out of the money to compound the cheapness.

You’re buying with breathing space on your side, so that the trade has enough time to pan out in your favour.

You’re not booking without a very solid reason, once the trade is running in your favour.

You’re trying to book (deep) in the money.

You must, must, must let your profits run as long as you can. This is the toughest part, but also the most essential one.

That’s all.

No Greeks.

Just common sense.

Power of the Word

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Hey,

I’ve spoken to you about words before. 

I’m doing so again, because words are so important. 

Your words are you – your energy. Use them to do good. 

When you have something to say, please say it. Words stifled inside become toxic, and bring you illness. Set them free. You’ll feel light. Your energy will move and shake the world. Don’t worry about results. You have given freely. That’s what counts. 

Giving creates vacuum. 

Vacuum attracts flow.

Good things will flow towards you – very soon. 

That shouldn’t be the main reason to write, though. 

It definitely isn’t my main reason for writing. 

I write because writing fulfils me. I enjoy writing. I get a kick. I feel free. It’s my passion. 

The flow I speak about above is just a by-product. 

Another phenomenon occurs. It’s interesting. Let me tell you about it. 

Writing clears up thought process inside your system. You understand your world better. Concepts get converted into DNA. Writing evolves you. 

There is no doubt in my mind that words are mightier than the sword. 

Words can be used to do maximum good – or maximum bad.

The human mind is capable of the highest and the lowest. 

Words can save life, and make it more beautiful. 

Words are capable of adding very high quality to life…

… and that’s how we plan to use them.

🙂

The Womb in which One’s A-Game is Born

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Simple situations don’t challenge you, and if a human being doesn’t feel challenged, he or she doesn’t grow. 

What would you like your A-Game to be?

Simple? Bread-winning? No surprises in store? Straight-forward? 

Fine.

If you don’t wish to feel challenged by it, that is your right. What ? You want to enjoy your A-Game, though? And you want to keep enjoying it for life?

Let me tell you a secret. If you master something, it becomes boring after a while. Where’s the challenge? You probably won’t enjoy something like that for life…just an opinion.

It’s taken me ten years in finance to actually discover what my A-Game is.

I’ve had a choice all along, I won’t hide that from you.

I’ve chosen two market niche-segments. I find both intriguing. Both fully absorb me. I keep asking questions. My mind feels that it meets its match. I enjoy both segments. 

It doesn’t matter which segments I’m talking about. They are my A-Game, and that’s what counts for this discussion. How did I know this was my A-Game?

Over the last ten years, I’ve tried all market segments. Got knocked around, made mistakes. Lost money. Tuition fees. You can’t really study the markets in college. You really need to study the markets in the marketplace itself. Eventually, an area of specialisation will speak to you. It will exercise a magnetism which will envelope you. Wait for this moment before going all-in. Even after identifying your A-Game, play it small for a long time, and only scale up slowly, according to strict money-management rules. 

The womb in which your A-Game is born can be really complicated. You can be left feeling confused for years about what your calling is. Life does remain a bit boring till you get there. You feel that that something is missing in life. While playing your A-Game, that very feeling is gone. That’s how you know it’s your A-Game. 

If you have a choice, secure yourself and your family financially before your A-Game unfolds. That way, your A-Game won’t necessarily have to yield you money in the beginning. Eventually , it will do that also, and of this there is no doubt in my mind, since complete engrossment into something will make you excel at that something. Treat the money as a bonus as it starts to come along. Focus on the monetary angle alone, forced perhaps by necessity, can make you lose sight of the enjoyment angle, or it can make you choose the more monetarily lucrative but less enjoyable activity. It all depends on your life-situation at that moment. 

Actually, come to think of it, whatever one does in life can be approached from a commercial angle only, blocking the enjoyment angle out totally. If your bread and butter depends upon it, I fully understand your choice, but if you’re already financially secure, then … go for growth, challenge, enjoyment… and money will follow too. 

Connection & Disconnection

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Sizzling hot stuff is best kept at an arm’s length … … something I learnt along the path … …

You reach for it at a conducive time, do what you need to do, and then you let it be. This way it doesn’t burn you. 

When you’ve let it be, you’re not thinking about it. Your mind has switched off from it. It is utilising its resources to do other stuff … … till it’s time to work with your sizzling hot stuff again. 

Now replace sizzling hot stuff with Mrs. Market.

There’s no doubt in my mind that Mrs. Market can burn you. You need to work with it in a manner that it doesn’t. 

You’ve understood that whole deal about the establishment of an emergency fund. Such a fund will render any burns only temporary. You have to have an emergency fund going first up, before you enter Mrs. Market. The income generated from this fund needs to cater for the basic requirements of your core family. Period.

Ok, good, so now you’ve got your protective gear on. Till you’re getting it on, you are absolutely disconnected from Mrs. Market.

Now let’s talk constant connection and disconnection. 

Why allow something or someone to control your moods?

No!

You are absolutely not giving Mrs. M that much power. 

Therefore, play small. 

How small?

Small enough to not lose any sleep over Mrs. M. 

Play with stops. These allow you to disconnect from Mrs. M and focus on other work. Other work is as important as Mrs. M, or perhaps more important. Yeah, show Mrs. M her place in your life. This way she’ll behave herself. Giver her any more leeway, and she’ll take over your life, and you don’t want that, right?

So, connect to Mr. M, do your work, place your stops, and disconnect. 

Don’t think about Mrs. M till you connect to her again. 

The period in between connection and disconnection is your time. Use it for any activity that has nothing to do with Mrs. M.

Day in, day out.

 

 

Learning to be Blunt

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Don’t like something? Is it causing you harm? Is someone bothering you? Is something draining your energy? Are you unhappy with a situation?

Get a grip. 

Get that something or someone out of your way. Now. Be blunt about it.

It pays to be blunt. I’m really learning this the hard way, but today I feel there is a lot of truth in this. 

I’ll tell you how I’ve benefited. 

All uselessly energy-depleting people and situations are now out of my life. With the surplus energy saved, I am able to create. 

Stonewalling is for bankers, private investigators, cops, crooks and what have you. 

Diplomacy is for diplomats. Let them do their jobs. 

I’ll do my job. I wish to conserve maximum energy for activities I enjoy and which are beneficial to my surroundings. To achieve this, I have learnt to be blunt. 

Who was my teacher?

Ever wondered?

I mean, do you ask such questions?

Do you use your imagination?

Do you grow?

Are you doing justice to your incarnation as a human?

Ok, enough provocation. Who was my teacher?

None other than…

… Mrs. Market.

I take my stops.

I’m blunt about taking small hits. Very, very often. 

So often that…I’m numb to their pain. 

This puts me in line for…

… fill in the blanks…

… big wins …

… provided …

… fill in the blanks …

… what, you thought this would be a spoon-feed… ? …

… well, … provided…

… provided I let my profits run. 

Thunder, Lightning and the Road Ahead

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Why do you look here and there?

If there’s a road ahead of you which you have defined, why don’t you just go ahead and tread it?

Is it mandatory to get distracted by things that don’t concern the path?

In the marketplace, it’s all about mind-set.

Free your mind.

Unburden it.

Dump all useless stuff into the bin. 

Secure your family’s basic bread and butter.

Identify a portion of your surplus cum non-invested cash as your NGHM (nobody’s-getting-hurt-money).

Enter the marketplace with your NGHM.

You are armed with your system.

You know how to identify your trades. 

You further know how to enter, manage and exit your trades.

These are the basics.

From here on it a mind-game.

Not partially. 

Fully.

It’s fully a mind-game from this point on. 

Mentally resilient? Are you? Well, you’re going to create thunder with your system then. 

Don’t get distracted by the lightning on the path.

Tread the path with complete confidence, drawing upon your full mental resilience. 

The road ahead is painted with glory.

Happy Third Birthday, Magic Bull!

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Hey,

We turn three.

You know it, and I know it…

… that this year’s been a slow going.

Sometimes, life is slow.

Such junctures are great times to recuperate and consolidate.

Inaction is big in the markets.

Very few know how to be inactive – and stay sane.

Those who do – well – they make big bucks when it’s time for action.

That’s only if they haven’t gotten rusty and lazy by then.

Yeah, inaction is an art.

In the markets, it is at least equal in importance to – action.

So, for the most part of the year that’s gone by, my market activity’s been practically zilch.

It’s not that I’ve been sitting and twiddling my thumbs. No! For heaven’s sake! Of course I’ve been doing other stuff.

Inaction in the markets must be coupled with action elsewhere, if one plans to stay sane, that is.

Also, inaction in the markets leads to preservation of capital. That, what you made during active times, remains safe, pickled and intact.

Then, when there’s opportunity, you’ve got your whole arsenal to cash in with.

While changing gears, don’t jump out of your seat with your saliva drooling, though.

Have some rules in place for opportunistic action.

I have some basic rules for myself at such junctures. I don’t put more than 10% of my networth on the line, while pursuing an idea. This rule applies for me while changing gears too, more than ever. Also, I don’t pursue more than two ideas at any given point of time. Most of the time, I’m not pursuing any idea, till an idea appears, refuses to break down, and just sticks.

Safe.

Simple.

Comfortable.

Ideal circumstances…

… to hit the sweet-spot…

… when it’s time for action.

Wishing you happiness, safety and profits in whatever market activity you pursue,

Yours sincerely, and just there for you, period,

Magic Bull.

Taking the Pan out of Panic

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Panic – Pan = ic = i see = I SEE.

Times are unprecedented.

We’re breaking new lows of evil everyday.

Ours looks to be a hopeless nation.
Is it over for us?

Shall we pack up our bags and migrate?

Just take a deep breath. Bear with me for a moment. Try and cast your panic aside. Try and think clearly.

I’ll share with you an observation. Take any Indian. Doesn’t have to be an outperformer. Take an under-averagely performing Indian, for all I care. Weed him or her out of our pathetic system, and place him or her in a nation with good governance.

Lo and behold, our candidate will start performing. Not only that, soon, he or she will be outperforming. After a decade or so, he or she will probably have mastered the system and punctuated it with innovative short-cuts.

Get my point?

We are a resilient race. We might look fickle, frail and harmless superficially, but we can struggle, bear, survive, and finally break out. Just give us good governance.
Don’t panic. We’re not going down that easily.

What’s happening currently is a purge. Yeah, it’s a catharsis with a big C. While it continues, asset classes across the board will probably get hammered.

What does that mean for you?

Only one thing.

Stay in cash. Accumulate it. Learn to sit on cash. Sit on it as long as the purge lasts. Let its value depreciate, doesn’t matter. Park it safely with a conservative private bank. Fixed deposits would be the instruments of choice. Yeah, you don’t want to leave unattached cash lying around. Potentially, unattached cash could be susceptible to online fraud. Attach your cash, safely, and keep it before your eyes. Put some watch-dogs in place, as in sms and email alerts. Password-change attempt? You are immediately alerted. New payee added? You are immediately alerted. Watch-dogs bark.

As per my instinct, though we probably won’t go bankrupt as a nation, we might just go a long way down before the purge is over. After the purge, there will be tremendous bargains on offer, across the board, in all asset-classes. Cash will be king. Save your cash and sit on it – for that day.

Meanwhile, your wealth-manager will try to push you into panic purchases with your cash. As in, buying gold at 32k, and the USD at 65. Don’t listen. These are crazy levels. One doesn’t invest at crazy levels. These are not even normal trading levels. Yes, they are institutional trading levels. One does not invest at institutional trading levels.

It’s time to use your common-sense and maintain a cool head.

You can only do that by refusing to panic.

Why Emergency Fund?

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Why do you wear a seat-belt while driving?

Why do you purchase medical insurance?

Why does one carry two parachutes while jumping off a plane?

Why do you keep your spouse happy?

So you can live in peace, right?

Peace of mind – so important…

Without peace of mind, market decisions are warped. Disturbing factors cause you to take wrong decisions.

Once faced with a market decision, it is extremely easy to go wrong. There are many telling you what to do. Some have agendas, others speak wthout an agenda, for the sake of speaking. Topping that, Mrs. Market starts playing tricks on you. She’s almost always catching you on the wrong foot. You needs to be mentally alert to identify your initial error and correct it as per your outlined strategy. If your mind-control is compromised, you step deeper into the delusive web of Mrs. Market by not being able to identify your initial error, and then the error can get bigger, and bigger, and even bigger, till it has the capability to consume you.

That’s why emergency fund!

You are not bigger than Mrs. Market. No one is bigger than Mrs. Market. You might start thinking you are, because of a few successes. As a result, you might start to play bigger. Over-confidence will first cause you to make a small mistake. Because you will not have identified the mistake as a mistake, owing to delusional conditions, the small mistake might get bigger and bigger, till it becomes bigger than you, and your market career is over.

That day, your emergency fund will feed your family.

So, firstly, make sure that an emergency fund exists for you.

It needs to be accessible, i.e. liquid.

It needs to be sufficiently large.

Its contents should be safely parked.

If it is generating some income of itself, even better, but the emergency fund should not be locked-in. If it is locked-in, you should be able to access it in a maximum of 24 hours, even if you need to pay a small monetary penalty for full and irreversible access.

Your spouse, who you’ve kept happy, should know about the emergency fund, and how to access its contents. If you’ve not kept him or her happy, he or she might access this fund anyhow, and blow it up beforehand. So, keep him or her happy and in a responsible state of mind. It is possible that he or she is just not interested in finance, right, so then what do you do? Wait for your child to grow up, wishing that he or she has an interest in finance! Anyways, someone you trust should know how to access the emergency fund. If nothing else, write out all details in a file, and inform the person you trust of the file’s existence.

Why am I being so extreme about all this?

I’m big on safety. I don’t like seeing a market player blowing up, because I wouldn’t want that to happen to myself. Have you been to a circus?

The acrobats do have a safety line, don’t they? I mean, they practice all their lives, and pull of the most amazing stunts, again and again, day after day, but at the back of their mind, they know it’s over if they make just one mistake. Unless they have a safety line. If and when a mistake occurs, their safety line will save them. The existence of a safety line allows them to perform with peace of mind, and perform well.

It is exactly like that in the markets. One big mistake, and it’s all over.

Unless there’s an emergency fund.

It’ll allow you to survive, recuperate, and get back on track. When you’re back, you’ll most definitely not repeat the big mistake you made. Also, the first thing you’ll do is regenerate the emergency fund, before you get back to proper market action.

Here’s wishing that you never need to access your emergency fund, but also wishing that it exists in the first place.

Here’s wishing that its presence gives you the necessary peace of mind to perform better.

A Critical Look at Debt on the Balance-Sheet

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Borrowed money needs to be paid back.

Pray where is a company going to pay it back from?

From current reserves and /or earnings, of course.

Unless you do a Suzlon and restructure your 2 billion dollar debt.

When I hear the word “restructure”, I feel like puking.

By the way, one can even do a “Mallya”, and expect the government to pay off chunks of one’s almost 1.5 billion dollar debt.

By now, I’m really throwing up.

I mean, first, some people borrow. Then comes a spending frenzy. Then these people don’t want to pay back what they borrowed. Oh, sorry, some don’t even want to pay the interest back, let alone the principal.

Frankly, I don’t wish to invest in companies run by people who delay paying back their debt through maneuvering and manipulation.

I detest manipulation. Prefer it straight-forward.

You guessed it – I’m a debt-averse human-being. What pleases me most in a company is a debt-free balance-sheet. It is challenging to find debt-free companies that are able to grow freely and fast, and when one runs into such a company, it’s like a home-run. After that one waits for the right price, but that’s another story.

Most companies borrow. They wish to grow, and funds are not there, while opportunity is.

Fine. Borrow.

Then, show me that you want to pay back. On time. ( = integrity ).

Show me that you haven’t lost your marbles while borrowing, and have borrowed an amount which by no means risks the existence of your company. ( = balance ).

Furthermore, show me that you are creating value with the borrowed amount. ( = shareholder-friendliness ).

Show me, that after payment of interest on borrowings, you can still generate a reasonable earning per share. ( = diligence ).

That would make me want to invest in your company, despite your debt.

Oh, one more thing, I would only stay invested long-term in your company, if I see you decreasing your debt-burden year upon year. ( = like-mindedness, i.e. debt-aversion ).

Also, if any new debt taken on doesn’t fit the above criteria, I would look to exit. ( = over-confidence because of earlier successes ).

Once invested, keep rechecking the story every few months. Times are bad. If you don’t look, it is likely that a CEO will pull a stunt right under your nose. Yes, it’s totally possible that your investment doesn’t meet your criteria anymore, and that you are still invested. Don’t let that happen.

At least with regards to debt, have an exact check-list. If a company doesn’t meet your standards regarding debt, discard the company. During times of high interest-rates, large debt on the balance-sheet is like a raging fire which refuses to be stilled, and which can well terminate the existence of a company.

Your success as a long-term investor depends much on how you react to debt.

Here’s wishing you wary and successful investing!

Cheers!   🙂

The Ideal Entry

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What kind of destiny do you prefer?

A scenario where you know the game, and are a champion, with people gloating over you, and where you balloon into over-confidence, only to blow up big?

Or a situation where you are uncomfortably stuck with your surroundings, and make mistake after mistake in an effort to stay afloat, until you start understanding, then mastering and finally manipulating your environment towards mega-success?

What’s that? The latter?

Congratulations. You’ve chosen the path of pain. Temporary pain, but still pain. Pain pains. That’s why it’s called pain, and that’s why it is a pain. It has one basic characteristic, though, which most of us need to understand. Slowly but surely, the human being is capable of becoming immune to small levels of pain. That’s all it takes to win in the markets.

Why didn’t you choose the former path?

Did you know, that given a choice, most of us choose the former (“smoother”) path?

Why?

That’s because when we’re given the choice, the part about ballooning into over-confidence, only to blow up big is purposely left out. That’s the portion one needs to intuitively identify on one’s radar and then avoid, if one is able to remain in one’s senses and is not drunk on fame. The test portion, aha. There needs to be some test in life. If there’s no learing / evolution, what’s the point of the path anyways?

You didn’t choose the former path because its demon was disclosed to you.

Did you for one moment stop to think, that the second path also discloses its demon to you, but only partially? To balance things out, it also discloses the reward. What it does not spell out for you is the big IF in the middle. IF as in – IF you manage to stay afloat after making mistake upon mistake,  until you start understanding, mastering and finally manipulating your environment towards mega-success…

Aha.

The thing about this second path is, that you are on high alert from the beginning. You are getting hit, again and again, and it’s a battle for survival. You are evolving. You are in a great position to intuitively identify and understand the big IF, because, as I said, your senses are on high alert from the beginning. And that makes you fight even harder – no one wants to go down without a fight, right? When you’re in a do or die thing, and your hands and feet are moving to stay up, nature itself starts fighting for your survival. Your odds of making it improve tremendously. After making it through, you know the game by the back of your hand, and can go on to manipulate it to your benefit from there.

There’s another thing about this second path, and of course nobody tells us this. After you’ve won the first leg, the second path becomes the first path.

Ahaaaa!

Also, there’s another thing about the first path too, which again nobody tells us. After one has lost on the first leg, the first path becomes the second path.

Ha!!

So, what’s the ideal entry into a career in the markets?

The second path, obviously.

Make mistakes, make many, many mistakes, and make them when you’re a nobody. These will be small mistakes. They’ll hit you, but you’ll keep surviving them. Your market play will get bigger and bigger. You might even become very wealthy and famous. At that stage, the cost of a mistake will be big. If you’re drunk on your fame, there’s a huge chance of you blowing up.

Thus, an ideal entry into a career in the markets is the second path without the “getting drunk on fame bit”.

Believe me, you don’t wanna blow up. Blowing up brings baggage that lingers. Highly avoidable.

In the end, if you’re on the second path, and if you do become wealthy and famous, you are not going to get drunk on fame. Period.

And, if you’re on the first path, please come down from your high horse to properly approach each new trade with your full capability, with confidence but not over-confidence, and without feeling greater than God.

Two Minutes of Freedom

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Why have you come?

Meaning, why are you here? What’s the purpose of your earthly sojourn?

Do you want to do something new?

No? How boring is that?

Why would you just want to live and leave with nothing original to your credit?

At times, I feel the urge to discover something earth-shaking.

Don’t you?

I mean, don’t you want to go where no human has gone before?

Whether we are successful or not is not the point.

At least we possess this desire.

And that’s where freedom of thought comes in.

You are born free, to think.

No one can steal that freedom from you, even in the worst conditions of bondage.

Use your freedom.

Think freely, even if it’s for two minutes a day.

Lose all shackles, as a rocket in space loses a burnt surplus engine. Define your own path, and think freely on that path. Develop it, bit by bit.

Slowly, your thought will take form. A whole system of work will emerge. Keep developing this.

Your system will take you places. For example, if you’re playing the markets, it’ll win you money.

It is new, it is original, it is your system, and it can well take you where no human has gone before.

Well done, keep going … … and it’s all happening because of the two minutes of freedom you allowed yourself.

Who Told Who So?

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Nobody’s in a position to tell anyone so.

That’s the marketplace for you in a nutshell.

There are times when you’re sure a scrip has peaked, and it just keeps on going higher, and higher, and then even higher.

At other times, a scrip might show tremendous valuations, but it just refuses to rise. 9 years in a row. Just refuses to rise.

Welcome to a world where if you’re able to watch your own back, you’re good.

In the world we are speaking about, a Rakesh or a Warren are what they are because that’s what suits them particularly. What suits them might most definitely not suit you. What makes you think you can emulate someone in the marketplace?

That’s the whole point, people.

You need to carve out your own unique niche in the marketplace. Something that suits you, and just you. If you do that, you’ll be happy. Satisfied from within. And that’s when you’ll start doing well.

Your best performances will come when you start being … … yourself.

Playing someone else’s game? Well, try to. Don’t be surprised if you lose your pants.

Your biochemistry is unique. So are your reactions to subtle changes around you. Thus, your interactions and dialogues with Mrs. Market need to be unique. These need to cater to your needs, your queries, your tendencies and your idiosyncrasies.

We try to follow rules. We want to master Mrs. Market. Frankly, what a joke!

Firstly, we need to make our own rules, for ourselves.

Secondly, Mrs. Market needs to be understood, even if for short spans, and she most definitely doesn’t need to be mastered. She’ll master you rather than you her. Be wary of her, win from her, but why do you wish to conquer? Fool’s paradise. Stick to the script, pal. Take your winnings and go. Why do you bet the farm, in an effort to make a killing? You’re not proving any point to anyone. Everyone’s busy doing their own thing with Mrs. M. No one’s looking at you. You don’t need to prove anything to anyone. Don’t bet the farm. Stick to the script. Take your winnings and go.

So, what’s the real learning in this world we speak about?

When you go wrong. That’s when real learning begins. How do you handle yourself? How do you come back? How do you start winning again? How do you then keep winning, again, and again, and again.

That’s the learning.

I didn’t tell you so.

You discovered it for yourself.

Remember that.

Discover it for yourself.

What’re you waiting for?

Danza Kuduro x Gangnam Style = Indian Political Circus

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Can you ignore the circus around you?

Sooner or later, you’ll need to learn how to.

Why?

Because growth is where we are.

And, growth is dying in many parts of the world.

So, why do you need to ignore the circus?

To focus. The circus won’t let you focus properly.

And why do you need to focus?

To take advantage of the growth around you.

Growth is a coveted commodity, remember that.

One could say that you are lucky to be born in an area showing growth. You are in demand. People from other parts of the world want to participate in any available growth story. These are competent people, selling highly developed technology and expertise. They deserve to participate in growth stories, why not? The question here is about you.

Are you able to make the most of your times, and that too – ethically?

Then forget about the circus.

The circus won’t let you function ethically.

You need to learn to function despite the circus.

Welcome to the world of minimal exposure. At times, you will need the circus, since it controls the machinery of your system. That’s about it, that’s your minimal exposure. No more exposure than what is absolutely required – these are golden words summing up your policy of minimal exposure.

And you are totally going to succeed despite minimal exposure – many have done so already, so why should you be an exception?

The quality of success that emerges, after having followed a policy of minimal exposure, is sweet. It’s a no-strings-attached kind of success. It is lasting, and brings peace and exhilaration. Definitely worth striving for. So, circus shmirkus, don’t even bother, just go for it, and make the most of the growth happening around you. Because of your ethical angle, I wish even more, that you succeed.

All the best! 🙂

Going Legit in the Times of Robber Vodka

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A good, clean, healthy and tension-free life – don’t you want that for your children and families?

Right, people, go legit.

It is possible, despite the Robber Vodkas, the Call Muddies and the Rama Lundgren Rajus of our times.

The first step is going white.

Go white, people. Declare your assets, pay your taxes, just sheer refuse to deal in black money as much as you can, and for heaven’s sake, start cutting out unwanted people dealing in black from your lives.

Second step – avoid people wearing whites. 98%+ of male folk dressed in whites in this country are either inactively or actively politically connected. In the process, you might pass up on the 2% genuinely good ones in whites, but you’ll have avoided all the ones you want to avoid. Political connect in India will not allow you to go legit. People hook up with politicians for favours, and / or because they feel that in their hour of need, their political clout will save them. Did you know, that for the one favour, your political connection will make you do ten illegit things in reciprocation, stuff you’d never dream of doing normally. Ask yourself. Is the trade-off really worth it? No, right?

Then, avoid dealing with people who use body-guards. I mean, use your common-sense. There’s no reason to shun a benevolent, well-known corporate honcho with or without body-guards, like Anand Mahindra for example. You’ll learn to recognize shady honchos. There’s that feel about them, that mafioso vicious vibe. If you can sense that vibe in a honcho, don’t deal with that person. Forget about the profit you’re losing out on, and look at the level of tension and complication you’re avoiding.

Don’t deal with people promising stupendous returns. Nip the Ponzis in the bud. Dealing with a Ponzi will eventually land you in court, to get your money out . Believe me, you don’t want our super-efficient judicial system messing up your life, if you can help it.

Be firm while dealing with any government officer. The government officer will only start to misbehave if there is any weakness from your side. Remember, a government officer is supposed to serve the nation. His or her salary is paid from the taxes you dish out. If your dealing is clean, the official could harass you for refusing to bribe, but that’s about it. Take the harassment, but keep coming back till your work is done. We need to stop bribing. Then, and only then will government officers eventually stop expecting us to bribe.

Right, we’ve pretty much cut ourselves off from a lot of people and things, so where does this leave us?

Don’t worry, we are not alone.

There are like-minded people around, and we need to make these like-minded people a part of our lives. Yeah, and we can lead good, healthy lives with such people surrounding us.

Also, don’t for a moment think we can’t do anything for our country, just because we’ve nixed the political linkage. Private opportunities come along everyday, to help people and society. If you want to still make a difference, grab these opportunities. Poor people come to you for medical aid. Help them. You can contribute privately to social-welfare. Many private citizens are running clean NGOs. As the name suggests, these NGOs have no government involvement, and are less likely to be corrupt. Funds donated to clean NGOs will very likely reach disaster areas on time and in full.

You can make a difference, all by yourself. You don’t need a corrupt government to make a 20-odd% difference for you per unit of currency you trust them with, as tax or whatever. Yeah, only about that %age gets converted into welfare; the rest is nibbled up along the way.

Make a difference – all by yourself.

What are you waiting for?

Clean up your act, go legit.

It’s not going to cut you off from any good, clean and healthy action.

Trust me on this.

Happy Second Birthday, Magic Bull !!

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Seasons change. So do people, moods, feelings, relationships and market scenarios.

A stream of words is a very powerful tool to understand and tackle such change.

Birthdays will go by, and, hopefully, words will keep flowing. When something flows naturally, stopping it leads to disease. Trapped words turn septic inside the container holding them.

Well, we covered lots of ground, didn’t we? This year saw us transform from being a money-management blog to becoming a commentary on applied finance. The gloom and doom of Eurozone didn’t beat us down. Helicopter Ben and the Fed were left alone to their idiosyncrasies. The focus turned to gold. Was it just a hedge, and nothing but a hedge? Could it replace the dollar as a universal currency? Recently, its glitter started to actually disturb us, and we spoke about exit strategies. We also became wary of the long party in the debt market, and how it was making us lazy enough to miss the next equity move. Equity, with its human capital behind it, still remained the number one long-term wealth preserver cum generator for us. After all, this asset class fought inflation on auto-pilot, through its human capital.

Concepts were big with us. There was the concept of Sprachgefühl, with which one could learn a new subject based on sheer feeling and instinct. The two central concepts that stood out this year were leverage and compounding. We saw the former’s ugly side. The latter was practically demonstrated using the curious case of Switzerland. There was the Ayurvedic concept of Satmya, which helps a trader get accustomed to loss. And yeah, we meet the line, our electrolytic connection to Mrs. Market. We bet our monsters, checked Ace-high, gauged when to go all-in against Mrs. Market, and when to move on to a higher table. Yeah, for us, poker concepts were sooo valid in the world of trading.

We didn’t like the Goldman attitude, and weren’t afraid to speak out. Nor did we mince any words about the paralytic political scenario in India, and about the things that made us go Uffff! We spoke to India Inc., making them aware, that the first step was theirs. We also recognized and reacted to A-grade tomfoolery in the cases of Air India and Kingfisher Airlines. Elsewhere, we tried to make the 99% see reason. Listening to the wisdom of the lull was fun, and also vital. What would it take for a nation to decouple? For a while, things became as Ponzi as it gets, causing us to build a very strong case against investing a single penny in the government sector, owing to its apathy, corruption and inefficiency. We were quite outspoken this year.

The Atkinsons were an uplifting family that we met. He was the ultimate market player. She was the ultimate home-maker. Her philanthropy stamped his legacy in caps. Our ubiquitous megalomaniac, Mr. Cool, kept sinking lower this year, whereas his broker, Mr. Ever-so-Clever, raked it in . Earlier, Mr. Cool’s friend and alter-ego, Mr. System Addict, had retired on his 7-figure winnings from the market. Talking of brokers, remember Miss Sax, the wheeling-dealing market criminal, who did Mr. Cool in? She’s still in prison for fraud. Our friend the frog that lived in a well taught us about the need for adaptability and perspective, but not before its head exploded upon seeing the magnitude of an ocean.

Our endeavors to understand Mrs. Market’s psychology and Mr. Risk’s point of view were constant and unfailing, during which we didn’t forget our common-sense at home. Also, we were very big on strategy. We learnt to be away from our desk, when Mrs. M was going nowhere. We then learnt to draw at Mrs. M, when she actually decided to go somewhere. Compulsion was taken out of our trading, and we dealt with distraction. Furthermore, we started to look out for game-changers. Scenarios were envisioned, regarding how we would avoid blowing up big, to live another day, for when cash would be king. Descriptions of our personal war in Cyberia outlined the safety standards we needed to meet. Because we believed in ourselves and understood that we were going to enhance our value to the planet, we continued our struggle on the road to greatness, despite any pain.

Yeah, writing was fun. Thanks for reading, and for interacting. Here’s wishing you lots of market success. May your investing and trading efforts be totally enjoyable and very, very lucrative! Looking forward to an exciting year ahead!

Cheers 🙂

The Frog That Lived in the Well

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Once upon a time, there was a frog.

It lived in a well.

Its cousin, however, lived in the ocean, and this particular cousin came to visit.

Cousin froggy was stunned. How could one thrive in such a small space? Our original froggy, however, did not believe that one’s world could get any better. It loved the well, and only after much coaxing did it agree to see what the ocean was like.

Upon seeing the magnitude of an ocean, our original froggy’s head exploded. This story’s from Paramhans Yogananda. 

I’m sure you’ve heard this story from someone. Something similar probably happened to you too, of course on a much smaller scale of magnitude, with no head explosions and all that.

I used to walk around pretty smugly with my Blackberry, thinking that I was like there, connected. Experienced kind of a head explosion upon moving to an Android smartphone.

What is it about us humans?

Why are we so limiting?

Why do we create barriers around our life-experience, around our possibilities?

Market conditions keep changing. Just as we get tied up into a rut and define a market as range-bound and going nowhere, it breaks out. Are you able to cope?

Be honest.

Can you adapt to such changes in conditions?

Are you quick on your feet? Or are you lethargic, and full of inertia?

What’s that song by The Black Eyed Peas?

“don’t…don’t…don’t … … don’t-stop-the-party!”

I know you’ve been humming this song during your continuing debt market party, but there is more to the scene than just the debt market. The debt market is not where things start and end in the world of investing. There’s more.

The world of investing is like an ocean.

The next buzzing market will make itself known. It’s only a matter of time. Be ready for it. Don’t remain clogged up within the claustrophobic walls of one market only, out of sheer laziness and a false sense of security.

Get out there.

Experience the ocean, without your head needing to explode.

I know a guy who knows another guy who knows this guy…

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Well, congratulations.

So you’re well connected.

You probably play golf with the CEO of Big Balls Incorporated.

We’re not even going into how you wangled the slot.

You probably feel, that because of your connectedness, you can get away with anything in life.

Well, almost anything.

That’s the bottom-line.

You can get away with almost anything in life.

Here are two areas where your connectivity counts jack. As in El Zero. Nadda.

One is before the Almighty (presuming that God exists). Buying a slot with God using connections isn’t gonna cut it with the big guy. You can’t buy personal time with deities using money and / or connections, even if you think you can. Also, that “bought” time, when you shoved everyone else out of line, well, that time’s not going to make your life any better, or richer. You’ve just established yourself as someone who shoves others out of line using connections….that’s how your deity is going to view your performance. So, what you’re going to understand from this space is that before deities – the Almighty – God – the Metaphysical – or whatever you might want to call what I’m talking about, connections don’t work. You only end up scoring negative in your deity’s books.

Which brings us to the more relevant matter – where else do connections not work?

In the marketplace of course, my friend.

Don’t believe me? Fine, find it out for yourself, the hard way. Or, read on.

You see, in the marketplace, insiders have an agenda. All insiders. They have an agenda.

That agenda is personal. It includes them. It doesn’t include you … … if you’re not connected to the insider. Once you are, and you use that connection to fish for “lucrative” inside information, that’s where the insider’s agenda starts to include you. The information you get is as per the agenda of the insider. If a promoter wishes to off-load huge quantities of stock, you will be told that the stock’s a good buy, because blah-blah-blah-blah-blah. On the other hand, if the promoter wishes to buy back large quantities of stock, because of attractive valuations, you’ll be told to sell the stock owing to tricky prospects in the future. You are not getting quality information when you fish for tips. You’ll only find yourself getting trapped if you follow insider tips.

There are good insiders too … is that what you are saying? Ok, fine, some insiders are good human beings. They are not vicious, and they wish you well. They might even want to do you a favour, wishing that you make some money from the information they are letting out. All true. Question is, does it really work?

No.

Why?

You see, an insider never functions alone. When a company experiences a turnaround or a great quarter comes along with excellent earnings, white-collared people connected to the functioning of the company obviously know this, and they leak this information out (for a price) to smart researchers and investors. These smarties (along with their entire intimate circle of connectivity) buy into the company’s prospects. The money moved is called smart money. Smart money registers / reflects on the traders’ charts. The scrip might show a bounce-back from a low with huge volume, or a resistance might be broken, or a new high could even be made (all coupled with large volume). Traders latch on. Price movers higher. All this is happening before the CEO has announced quarterly results, mind you. Finally, a few days before the results, the corresponding results-file lands on the CEO’s desk. He or she congratulates his or her staff on the spectacular performance, and over a round of golf, the information is shared with you. The CEO is obviously thinking that the market is going to react positively to the earnings surprise that’s going to be announced.

Well, the earnings are not going to be a surprise. The market already knows, and earnings have thus already been factored into the price, before results are announced. Announcement time is generally selling time for traders, who tend to sell all stock upon the first spike after announcement. With no more buying pressure (since traders are out of the scrip), the inflated scrip tanks despite the good news, leaving you stuck with a peak-price buy. Well done, well done indeed.

See, that’s why. Don’t listen to insiders, even if they mean well.

In the marketplace, you really are on your own. Isn’t that exciting? As in challenging?

All the best, my friend. Learn to rely on your own judgement.

Do You Believe in You(rself) ?

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Still not hit the success button?

Suffering from an inferiority complex?

Market got you down?

Is it over for you?

Which brings us to the more important question : Do you believe in YOU?

Wrong English, I know, I know. Sometimes I misuse the language for effect. The effect is more important to me than how silly I look because of bad grammar.

Ok, so you want to succeed, make it big in the markets, blah blah blah.

Who doesn’t?

You obviously can’t last out if you don’t believe in yourself. Markets are draining, and tend to suck the living blood out of one’s body, so one needs to last. Market forces exhaust the system. It’s something about them, something electronic. This something consumes your stamina. So, no two ways, you need to last out. 20, 30, 40 years maybe…

I’m not saying it’s going to take you that long to succeed. For all I know you’re the next Jesse Livermore in a few years. Getting there is one thing, but staying there is another. Consistency. Maintaining success for many years in a row. That’s big. Something like that can be, and probably is, a trader’s lifetime goal.

It all starts with belief.

Baby steps.

First, weave a safety net around you. This involves the creation of a regular source of income to sustain your family’s basic needs. Such income needs to be independent of the market, any market. Your trading is not really begging you to earn your basic income. It can well do without that extra pressure. A comfortable slot for your trading to be in is when it can generate additional and bonus income for you. That’s the sweet-spot, and you want to be in it, with a comfortable safety net around you, free to trade the markets with no extra pressure.

Then, create a reliable system to trade the markets.

This can even take many years. I mean, some of us take seven odd years to recognize their basic risk-profile. Good, at least we are recognizing our risk-profile, because everything else is going to be built up on top of that.

As your system starts to perform, your belief in yourself gets stronger. Good going, stranger, now do humanity a favour and support others who are struggling to find themselves. In any way you can. It’s good Karma, and will help you further on your own path.

Then, you hit it big-time, your system catches some huge market swings, and you are there.

Now, other things start happening. Success brings with it its own entourage.

Remain on the ground, please. That’s how you are going to last out. Keep trading. Hitting the magic spot is not enough, you need to milk it as long as possible. Your new status of “successful” will bring many to your doorstep. The crowd wants to acquire the magic formula from you. People want your time. Deal with it, buddy. In a manner that still keeps you performing in the Zone, trade after trade. Also, in a manner that keeps you from hurting anybody’s feelings. I know, thin line, difficult to do, but you don’t additionally want the remnant emotional baggage of hurting people to affect your trading.

Apart from fame, there are other members in the entourage of success, and I’m just classifying them ad-hoc under the header “extra-curricular activities”. Yup, these will come your way. That’s part of being successful and famous. Well, do what you want, you’re a grown-up, nobody’s going to tell you where to draw the line. All one can say is, that if any extra-curricular baggage starts seeping into your trading, you’re going down Sir. Period.

Oh, where did it all start? Belief, right. Look where it can get you.

So come on, get up from your drawdown. Drawdowns happen. They are part of the learning process. The earlier they happen, the better it is for you. Now, you probably won’t let them happen when the stakes are big. When a future drawdown looms, you are prepared, and nip it in the bud. You don’t let it grow into an ulcer. That’s what your earlier drawdowns have taught you.

So get up and give it another shot.

All it takes is a bit of belief.