So, Who’s Buying?

Yeah, who’s buying?

Superinvestors? 

Sure. Tremendous pipeline, great bargains, of course they’re buying. 

Who else?

Market-makers.

They buy and sell for a living.

They make the market for us to trade in.

Let’s forget about them for this discussion.

Anyone else?

The syndicate?

What syndicate?

I mean, is there even a syndicate?

Let’s not go into conspiracy theories. 

Whether or not there is a syndicate should not affect us. 

Moving on…

…think of anyone else?

Mutual funds?

Sure.

Lots of SIPs going in, a few NFOs doing the rounds, yeah, MFs are biting.

Foreigners?

More like exiting.

Hedge funds?

Busy trading I guess, won’t count them as strong hands, they’ll book a profit and will be sellers, over the short to medium term. 

What about retail guys?

Retail investors are scared. 

They’re tired of bad news. 

They’re tired of the markets.

Most have run away. 

Most of those who haven’t, want to. 

Is any retailer buying?

Well, the small entry quantum guys are. 

Why?

Firstly, they’re liquid.

Their strategy leaves them liquid, … , like forever. 

Till when are they going to buy?

As long as quality is selling cheap, they’ll continue to buy.

Are they scared?

No.

Why?

Their strategy gives them the courage to work on full throttle at times just like these. 

Times like what?

You know, bad news galore, whatsapps, lay-offs, scams, everything under the sky that can take place – is taking place.

And you know, bring it on. Gloom, doom, kaboom, and quality will start selling even cheaper.

We are loading up on quality and will continue to do so as long as it is cheap.

We’re happy that there’s a buying opportunity.

🙂

Going beyond the P-Word

Hey,

You panicking?

Why?

Don’t.

How?

To go beyond panic at a time like this, you’ll need to be amply liquid. 

And, then, you’ll need to have the guts to engage. 

One way for remaining liquid for life is to follow a small entry quantum strategy. 

Since we’ve spoken about such strategy ad-nauseum in this space,…

…yeah,…

we won’t be going into the nitty gritty of how the strategy works for the moment. 

In a nutshell, our small entry quantum strategy leaves us liquid, and then some. 

What exactly is a time like this?

Well, Benzes have started to go for the price of fiats, and…

…that’s why we need to…

…engage. 

Forget your pain, pinch or panic. 

Buy…

…quality that’s going for a song.

Now.

Keep buying such quality for as long as the cheapness lasts. 

Year, two years, three, four, bring it on. 

When you engage in this manner, you’ll have gone beyond all your P-words. 

Wishing you lucrative and happy investing!

🙂

Making Time Work For You

Imagine…

…entering into a stock…

…many, many times.

When would you do that?

When your research is solid, …

… when you’re amply liquid, …

… and of course when the stock keeps giving you margin of safety to enter for a longish period of time.

There’s no excuse for not doing solid research. 

It’s a given.

Research – solid – period.

How do you render yourself amply liquid?

You do this for example by following a small entry quantum strategy. 

Let’s have a look at one advantage that springs up in particular. 

You become an expert in the stock you are entering into again and again. 

You know its nuances over time.

You start getting a hang of its overpricing, underpricing, par value, good results, bad results, and what have you. 

You’re in it till you’re convinced about it, sure. 

While you’re in it, you’ve developed an expertise on it.

You’ll take that, right?

Sure. 

What exactly have you done?

You’ve made time work in your favour.

First up, staying invested in a fundamentally sound stock over a long period of time should give you a good return.

Then, repeated interaction over the passage of time gives you expertise. 

Double-shot, please!

🙂

Feeling

Who writes the rule-book for your market-life?

You do.

Why do you do it?

Nobody else is qualified enough.

You know yourself better than others.

Don’t you?

Thus, one feels one’s way through the markets, setting up lamp-posts and rules.

For example, I recently discover how to integrate my investing life with my trading life, in one particular market.

It takes me a long, long time to do so.

Nothing has really worked on this front.

Both lives have been getting affected, adversely, because of each other.

It’s outright frustrating and, I just sheer stop trading this market, to allow my investing life to prosper.

Simultaneously, I keep feeling my way through, trying out various permutations and combinations…

…, one of which seems to be working.

How do I know?

I’m trading again.

What have I done that I wasn’t doing before?

I haven’t been using the concept of exhaustion.

I exhaust my ability to invest, opportunity-wise.

Since I follow a small entry-quantum approach, liquidity exhaustion isn’t going to work.

Opportunity exhaustion is.

As opportunities keep coming, I keep going in, each time with small quanta, not changing anything in my investment approach.

One fine day, there is no margin of safety being offered.

I don’t feel like going in.

I am exhausted.

I shut down my investment widow…

…and then {[:-)]}, open my trading window.

Within an hour, I take a trade.

Lo and behold, integration has taken place.

Seamlessly.

All our demons are inside of us.

If one is not dying, exhaust it with feeling, even temporarily, to look after your other vital activities.

The Cue from Disturbia

I am disturbed. 

This stock that I’m invested in is continuing to fall. 

That’s ok.

I want to be disturbed. 

That’s my cue…

…to invest more in the stock.

I’m in the stock for a reason. 

Something appeals to me. 

That something continues to appeal to me, despite the continuous fall. 

If that were not the case, the case for the stock would be closed, and one would look to get rid of it on a market high. 

However, that is the case,…

…and, I follow the small entry quantum strategy.

Where does that leave me?

My investment in the stock is small.

I am liquid.

That’s the beauty of the small entry quantum strategy.

It leaves you liquid.

Continued fall means better margin of safety, and that another quantum can go in.

The small entry quantum strategy ensures multiple entry opportunities as the stock continues to generate margin of safety.

When do my ears stand up?

When the fall is disturbing enough. 

The fall is the cue to go in. 

It is from Disturbia. 

Who said making money was easy?

This strategy works as long as one’s research is sound. 

Let’s go with what works.

Busy Times

Market falls are busy times. 

No, we’re not busy whining. 

We’re busy buying.

Are we not afraid?

That the crack might deepen?

That it might go down to zero?

No.

We’re not afraid of this scenario. 

Meaning?

Meaning that even though such a scenario cannot be ruled out…

Huh!?

Yeah, it can’t be ruled out. With trade wars and back to back black swans waiting to strike, theoretically, the bottom is zero.

And you’re not afraid?

No.

Why?

Because I buy into fundamentally sound businesses…

…zero debt…

…great 5 year numbers…

…sometimes, great ten year numbers…

…and I buy with considerable margin of safety.

Still, one is normally always afraid, right?

Wrong. A small entry quantum strategy kicks out all remnant fear.

How?

This strategy leaves me liquid. Let it go down to zero. I’ll still have liquidity to buy.

And that which you’re buying…

…is sound, yes. If I buy something sound, it will yield returns. It’s like agriculture. Crops grow in good soil. They don’t grow well in bad soil. I make sure that I choose excellent soil.

How does one do that?

Due diligence. Period.

With all the scams and frauds going on…

Well, I look long and hard for shareholder-friendly managements. Representable salaries, willingness to share, largesse, debt-averseness, intelligence, business savvy, the list goes on.

What if you land up with a fraud management?

Solid research will make you avoid scamsters. I search the internet thoroughly for any kind of smoke. Crooks leave a trail, and one is able to catch their online trail pretty easily. 

Alone online?

Second recourse are annual reports. They reveal a lot. I don’t invest in a company without having a thorough look into its annual reports. I look at CSR, the director’s report, skin in the game, balance sheets, profit and loss statements, cash-flow, special items, what have you.

What if you still land up with a fraud?

After I know I’ve landed up with a fraud management, I would look to exit at the next market high. 

What if your holding is wiped out till then?

If it’s wiped out, I have many other holdings to lean on, and don’t forget the liquidity that is yet to flow into honest managements.

So you’re not afraid of the loss?

There is some risk one has to take. Here, it is the risk of being wrong. The good thing is, once I know that I’m wrong, I won’t double up on my wrong call. I’ll get busy elsewhere and look to exit from my wrong call with as little damage as possible, perhaps even in profit.

Profit?

You forget, I like to buy with margin of safety, and you’d be surprised at what people are willing to pay at market highs. 

I see, well then, happy investing!

Thanks! 🙂

Nath on Trading – II – Building up on Basics

21). You started small, right?

22). Ultimately, you’re staying consistently in the green, correct?

23). Then it’s time to scale up. Slowly does it.

24). Why the whole spiel about starting small? You make your biggest mistakes in the first seven years.

25). Hopefully, you don’t repeat a mistake once it has happened, and once you’ve learnt from it.

26). However, mistakes are good, because they teach you. Nothing else can teach you with incorporation into DNA. Mistakes can.

27). No university can teach you. No books. No professor. Play the market, make the mistake, and learn.

28). A big break early in the markets is a recipe for disaster. More likely than not, you’ll blow up later, when it matters.

29). The best possible way to scale up is using position-sizing as delineated by Dr. Van Tharp.

30). The good thing about position-sizing is that it makes you scale down, when trading corpus goes below par.

31). Day trading takes up the day. You’re exhausted and are not able to do much else.

32). Short-term trading also keeps you riveted to the terminal, mostly.

33). However, position trading and longer time frames keep you in the line for whatever else you wish to achieve.

34). Market TV makes it a video game. Switch it off.

35). Trading with targets caps big-win potential.

36). When you trade, you trade. You don’t invest.

37). Successful trading means buying high and selling higher, or…

38). …selling low and buying back lower…

39). …as opposed to successful investing, which is buying low, not selling for the longest time, and then selling for a multiple.

40). Read points 16 to 19 again.

This is Why Your Blockbuster Gain Story is going to Happen

You’re learning to sit. 

You buy with margin of safety. 

You buy in small quanta,…

…and that’s why you’re always liquid,…

…to avail any opportunity that arises. 

Yeah, there’s nothing impeding your liquidity…

…because you’ve kept yourself virus-free, i.e. debt-free. 

You only buy quality…

…that’s going to be around for a long, long while,…

…because you don’t sell for a long, long while. 

You don’t listen to what the grapevine is saying…

…because of the conviction and strength of your own research and opinion.

Yes, you regularly go against the crowd. 

You either buy into debt-free-ness, or into managable debt that spurts growth. 

Your input into the market doesn’t affect your daily life, leaving you tension-free to address your non-market world and thrive in it,…

…and that is why,…

…for all the above reasons,…

…your blockbuster gain story is going to happen,…

…and what’s more,…

…you are also enjoying the ride leading up to it. 

Blockbuster Wealth Stories in Equity still do the rounds

The latest one doing the rounds…

…is the Bezos parents’ story. 

Their investment in their son’s company twenty three years ago has returned a whopping twelve million percent, making them become worth billions.

Staggering.

You can have such a story too. 

Here’s how. 

Identify pockets of value. 

Invest in these pockets of value. 

Money going in is something you don’t need to touch for a long, long time.

Build up a sizable investment in each pocket, bit by bit, as long as it remains value. 

When value becomes growth, let it be.

Occupy your mind elsewhere, looking for more value. Don’t bother looking at what’s started to grow. 

If you’ve picked well, out of your many pockets of value, some will become good growth stories over the years. 

A few of these runners will turn into multibaggers. 

And then, there might one odd investment, that returns a staggering amount, just like the above mentioned example. 

It’s not over. 

You let this one run. 

Don’t finance your prodigal son’s wedding from this one. Do it by selling your losers, if you have to. 

Why let it run?

What’s returned a hundred thousand percent today might well return a million percent or more over time, if we let it…

…be.

 

 

Try retaining one-off Wealth

Easy come, easy go…

…am sure you heard that one before…!

When you come into something too easily, you sure do want to spend it, right?

Well, why not?

However, do take that one step back.

Let’s explore the possibilities here. 

You can spend it all. Have a blast. Blow it up. Yeah. We’ve touched upon that. Know many people like that. 

Or, you can save some and spend some. 

How about that?

Who’s asking you to save it all?

No one. 

You like spending?

Fine. Spend. A bit. Gratify your most burning desires without injuring anyone’s fundamental rights. 

Then, save the rest. Pickle it. Look away. Move on with your life. 

Why?

Lady Luck smiled. You got your one-off dose of wealth. Use some of it to make wealth a permanent feature in your life. 

For that to happen you’ll need to invest, be patient, compound, reinvest and what have you, till many many cash flows take care of all your needs. 

From which point did it start?

From the moment you decided to save some of your corpus and provide it with the necessary environment to grow.

It’s a basic decision…

…, yeah, a real simple one…

…that’s tough to implement. 

Try retaining wealth. 

You’ll then know exactly what I’m talking about. 

Wealth-Generators know how to Sit

Most humans don’t know how to sit. 

Most humans are not wealthy. 

If you are a wealth-generator, you’ve probably already made the connection, knowingly or unknowingly. 

You sit. 

You are focused.

You know what you are doing. 

You are confident about what you are doing. 

You don’t keep looking over your shoulder. 

You are not jumpy. 

You don’t require a daily quote. 

In fact, you’re quite happy with a monthly quote. 

You know the value of your underlying. The world cannot tell you otherwise. 

You seal one wealth-generating opportunity, and move on to the other. 

That helps you to sit on the former, while you focus on the latter…

…till you seal the latter, which is when you move on to the next one, and so on and so forth. 

Soon, you are at the pivot of many, many wealth generating ideas. 

You are surrounded by multiples. 

Some have fully matured. 

You bring them to their logical conclusion. If this is a cash-out, well it’s a cash-out. 

You move the funds resulting appropriately…

…perhaps to a new avenue…

…or perhaps to finance something big…

…be it a lifetime-requirement…

…or what have you. 

You recognise the fact that one of the main purposes of wealth is also to fulfil lifetime-requirements. 

Mere income is not able to fulfil these. 

Generated wealth is. 

You recognise that. 

You are a wealth-generator. 

You know how to sit. 

Adding No-Action to your Repertoire

Action with positive outcome vs…

… no action vs…

…action with negative outcome…

…hmmmm.

Sometimes we become oblivious to actions with negative outcomes.

Society preaches to be active.

We listen.

We feel that doing something means a step forward.

Well, it ain’t necessarily so.

Many times, and especially in the markets, it actually pays to do nothing.

The most successful investors in the world will tell you, that the biggest money is made while sitting. They’ll also tell you, that almost no one has learnt how to sit.

They’re right.

Meanwhile, I’m telling you, right here and right now, that you can sit comfortably upon your investment without jumping only if you’ve bought with margin of safety. Think about it.

Also, the most successful traders in the world will tell you that the number one action that saves money in the markets is no action. Yeah, when markets move sideways, which is about 60%+ of the time, trades tend to get stopped out both ways, and the trader loses money repeatedly. At such times, it’s better not to trade.

What’s vital here?

Recognition.

Recognize that it’s a time for no action.

Then, do something else.

For this to be practical, make trading and investing your bonus activities.

Meaning, that if your bread and butter depends upon another mainstream activity, you can easily switch off from trading and investing for a while, at will, and without any negative impact upon your basics.

Also, you need to be versatile enough to have fall-back activities lined up, which switch on where trading and / or investing switch off. These need to take over then, and keep the mind occupied.

The danger of not going into no-action mode is the continuous committing of actions with negative outcomes.

That’s precisely where we don’t want to be.

 

 

 

 

 

 

 

What about Daddy Cool? 

Boney M sang this blockbuster hit in the ’70s.

I’m sure you’ve heard it, because it’s still the rage. 

he’s crazy like a fool – what about daddy cool? 

Who’s Daddy Cool? 

You tell me. 

Is it you, in a cool cucumber moment, slow to respond to stimulus, devoid of anger, master of your situation in a kinda non-bossy, non-micro-managing (cool) way? 

And what of Mr. Hyde’s Dr. Jekyll nature? 

We’re talking about your “like a fool” moment.

Just for your information, winning behaviour is often termed foolish by the crowd. 

Contrarian investing is one such example. 

Successful derivative trading is another. 

To cap it, let’s not even talk about private equity in real-estate. 

Did someone mention high-yield structured-debt? 

There are many examples of “foolish” behaviour. 

These same examples earn very well. 

So… 

… how do we do it? 

We maintain our cool. 

We keep all basics going, as they are. 

With a small portion of our surplus, we take calculated risks, in a controlled environment. 

Sure, these risks will appear foolish to someone on the outside. 

However, our controlled environment has installed riders for our safety. 

A balance-sheet might be stressed, but not stressed enough for bankruptcy. 

A lock-in might be ultra-short. 

A stop-loss might be in place. 

Collateral might be up to 4x.

There might be a highly reputed Trustee in between. 

What have you.

Have your Daddy Cool fool-moments. 

Take some calculated risks with small portions of your surplus. 

These should give your portfolios an extra-boost. 

The Promise of Far 

I like “far”… 

What promises me far? 

Science fiction films. 

The Interstellar, Gravity, Inception and Contact types. 

Such films relax me. 

What relaxes you? 

Have you identified it? 

Why is this important? 

Many times, we must just sit. 

Action is harmful at such times. 

We are tense. 

We suffer from the fallacy, that action is better than inaction at all times. 

Relaxation-source identification is exactly for such times. 

Go ahead. 

Get your acts together. 

Your full acts. 

Your planning needs to incorporate strategies for inaction too. 

“The Promise of Far”  strategy works well for me.

It’s not my only inaction-strategy. 

However, it’s a successful one. 

When Do You Bet The Farm? 

Bread and butter. 

Safety-…

…-net.

Basics.

You gather yourself to carve out a comfortable life for your family. 

Build-up. 

Debt-free-ness. 

Yeah, zero-debt. 

Feel the freedom. 

Breathe. 

No bondage. 

No tension. 

You have to feel it. 

Surplus. 

First, small surplus. 

Then, big surplus. 

You’ve made sure that nobody ever will remind you to pay your bills. 

Great! Well done. Now… 

… keeping all basics intact… 

… you play with small surplus. 

Risk. Calculated. Digestible. 

Multiplier. 

Loss. Cut small. 

Win. Allowed to grow. 

Small surplus starts giving regular fruit. 

You put back the principal into your family’s basic corpus. 

Repeat. 

Many of your small surpluses have grown into fruit-bearing trees. 

Your farm is bursting with grain and fruit. 

Have you taken any big, indigestible risks? 

No. 

Have you ever put your family basics at risk? 

No. 

Have you ever thought about betting the farm? 

NO. 

Will you ever bet the farm, no matter how big the lure? 

NEVER. 

Nath on Equity – almost there

Market being down 61). should not pinch you. If such condition does pinch you, you might react accordingly, and do something painful. 

You make market-downs not pinch you by being 62). miniscually committed at any given time. 

Also, 63). you continue committing your miniscule quanta during market downs. 

That’s because 64). you’ve made sure you have lots more to commit, by defining such an approach for yourself. 

You are 65). happy that the market is down, because it is giving you an opportunity to enter. 

You 66). switch off market TV. You don’t wanna know from them, because they themselves don’t know what works for you. 

All 67). useless emails and smses are put on block. 

That’s because 68). information overload is your nemesis. 

You 69). learn from everything you experience. 

However, you 70). don’t follow any market-person. 

That’s because 71). you are unique. Only you can benefit yourself, ultimately. 

You are going to 72). teach yourself to become a strong hand. 

Thus, you will 73). not get affected by the behaviour of weak hands, ie. the masses.

Instead, you will teach yourself to 74). take advantage of the behaviour of weak hands. 

Market players 75). commit the same blunders again, and again and again. 

That’s because 76). every few years, a whole new batch of market players starts behaving unreasonably. 

This proves to us 77). that the only real learning comes first hand from market-play, to you and you alone, and only from your market-play.

This also pretty darn well insinuates that 78). theoretical learning from books or universities has zilch value in the markets.

You’re lucky 79). if the market knocks you around during your first seven years of market-play, when the kitty is small. 

That’s because 80). exactly that learning from 79). is going to earn you big as the kitty increases during your meat-years of market-play. 

Nath on Equity – Some more DooDats 

Yawn, the story goes on… 

Let’s 21). not think about our folio at night. 

We’re also 22). only going to connect to the market on a need-to basis, no more. 

If there’s a 23). doubt, wait. 

24). Clarify doubt. If it goes away, proceed with market action. If not, discard action. 

Don’t spread 25). too wide. 75+ stocks means you’re running a mutual fund. 

Don’t spread 26). too thin either. Just 5 stocks in the folio means that risk is not adequately spread out. Choose your magic number, one that you’re comfortable with. 

Once this number is crossed, 27). start discarding the worst performer upon every new addition. 

28). Rarely look at folio performance. Only do so to fine-tune folio. 

Don’t give 29). tips. Don’t ask for them either. 

You are you. 30). Don’t compare your folio to another. 

Due diligence will require 31). brass tacks. Don’t be afraid to plunge into annual reports and balance sheets. 

32). Read between the lines. 

Look 33). how much the promoters personally earn annually from the underlying . Some promoters take home an unjustified number. That’s precisely the underlying to avoid. Avoid a greedy promoter as if you were avoiding disease. 

Is 34). zero-debt really zero-debt?  Look closely. 

Are the 35). promoters shareholder-friendly? Do they regularly create value for the shareholder? 

Are 36). strong reserves present? 

Are the 37). promoters capable of eating up these instead of using them to create value? 

Is the 38). underlying liquid enough to function on a daily basis? Look at the basic ratios. 

Is any 39). wheeling-dealing going on with exceptional items and what have you? 

40). Is the company likely to be around in ten years time? 

Yeah, things in the equity world need to be thorough. 

We’re getting there. 

🙂 

Sheer Moat Investing is not Antifragile 

There we go again. 

That word. 

It’s not going to leave us. 

Nicholas Nassim Taleb has coined together what is possibly the market-word of the century. 

Antifragile. 

We’re equity-people. 

We want to remain so. 

We don’t wish to desert equity just because it is a fragile asset-class by itself. 

No. 

We wish to make our equity-foray as antifragile as possible. 

First-up, we need to understand, that when panic sets in, everything falls. 

The fearful weak hand doesn’t differentiate between a gem and a donkey-stock. He or she just sells and sells alike. 

Second-up, we need to comprehend that this is the age of shocks. There will be shocks. Shock after shock after shock. Such are the times. Please acknowledge this, and digest it. 

To make our equity-play antifragile, we’ll need to incorporate solid strategies to account for above two facts. 

We love moats, right? 

No problem. 

We’ll keep our moats. 

Just wait for moat-stocks to show value. Then, we’ll pick them up. 

We go in during the aftermath of a shock. Otherwise, we don’t. 

We go in with small quanta. Time after time after time. 

Voila. 

We’re  already sufficiently antifragile. 

No magic. 

Just sheer common sense. 

We’re still buying quality stocks. 

We’re buying them when they’re not fragile, or lesser fragile. 

We’re going in each time with minute quanta such that the absence of these quanta (after they’ve gone in) doesn’t alter our financial lives. We’re saving the rest of our pickled corpus for the next shock, after which the gem-stock will be yet lesser fragile. 

Yes, we’re averaging down, only because we’re dealing with gems. We’ll never average down with donkey-stocks. We might trade these, averaging up. We won’t be investing in them. 

Thus, we asymptotically approach antifragility in a gem-stock. 

Over time, after many cycles, the antifragile bottom-level of the gem-stock should be moving significantly upwards. 

Gem-stock upon gem-stock upon gem-stock. 

We’re done already. 

The Thing with Sugar and Dairy

It’s common knowledge now. 

Cancer cells love sugar and dairy. 

In fact, they love them so much, that they grow ten (?) times faster in their presence. 

Just act as if the question mark isn’t there. 

I’ve put it there because I’m not sure whether the number should be eleven, or nine, or what have you. 

However, the numbers are deadly. 

Shocker, right?

Spent my childhood gobbling sugar and gulping dairy. Didn’t know any better. 

Now, only dairy going in (hopefully) is the good dairy. Yoghurt. 

Only sugar in diet is the good sugar. Honey. 

At least, that’s the goal. 

What makes these two “good”?

There’s something bio in them. 

Yoghurt’s got bacteria. They’re the good bacteria. They cleanse one’s system. Cancer cells don’t like them, because probiotic bacteria probably break them down. 

Honey’s got the saliva of bees, containing vital enzymes. These catalyse various biochemical and metabolic processes. Cancer cells don’t like them either. They like the sweetness of honey, but not these enzymes. So, honey’s a tad less dangerous.

The bio-portion saves the day. It’s for a good cause. It’s purpose is friendly, and positive. 

Cut to equity. 

Where does one look for terminal disease?

In balance-sheets and annual reports. 

Debt. 

Promoter ego.

Fraud. Scam. Manipulation. 

Creative accounting.

These are some of the things that can cause terminal disease. 

All of them might exist, at some level, in any given balance-sheet and / or annual report. 

What we need to gauge in our minds are the levels. 

Is any level alarming enough to cause terminal disease, or for that matter just disease?

Bearable debt leading to growth is even a good thing. It’s like a tonic. Unbearable debt leads to terminal disease. We need to stay away from a stock with unbearable debt on its balance-sheet.

Nothing functions without ego. I am. Therefore I do. However, an overbearing and overambitious ego leads to disastrous decisions that can cause terminal disease. We need to stay away from companies whose promoters have overbearing, self-promoting and overambitious egos. Such promoters don’t even realize when they’re functioning in self-destruct mode. Am not going to take any names here, but you get the gist. 

Frauds, scams and manipulations come under the category of “sheer disease that’s already terminal or just one step away from going terminal”. Upon finding them, needless to say, avoid the stock.  

Accounting. Sure, everyone’s busy getting creative here. We need to separate positive accounting from its negative counterpart. 

Accounting that leads to fund-availability at the time of need and results in value-creation for the shareholder is to be welcomed. This kind of accounting does not cause terminal disease. It creates a detour that strengthens the company overall in the long run. 

Such accounting whose sole purpose is to deceive the shareholder and benefit the promoter is a very big red flag. This kind of accounting leads to terminal disease.

While zeroing in on a quality stock, you’re simultaneously ensuring longevity-enhancing conditions. 

In the process, you’re automatically ensuring that your portfolio accumulates one gem after another. 

Wishing for you happy and successful investing. 

🙂

Decoupling One o Two

Trade on.

Market forces.

You.

Connection.

Attenuation.

Life normal.

This is the real decoupling.

What was the other decoupling?

The myth one?

Myth?

I mean, Switzerland is kinda financially decoupled. The CHF just keeps its own despite anything.

Israel is also sort of decoupled. Despite everything. Functions on its own tangent. Matter of opinion.

These are exceptions. They prove the norm.

There are remote chances these exceptions won’t exist tomorrow. Having said that, let’s hope nothing like that ever happens.

However, permanent decoupling is mostly a myth. We’ll be better off not incorporating it into our investment or trading strategy.

Decoupling one o two is a different matter.

It is very welcome.

It gives longevity and harmony to a trader’s market- and normal-life.

Happy trading!

🙂