Tag Archives: #wealthgeneration

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.

Wealth-Generators often go Contrarian

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You knew that too, right? 

Sure. 

Going contrarian is a buzz-phrase. 

We hear it again and again…

… till we begin to start thinking… 

… that we know what it means. 

Well, try going contrarian. 

Yeah, try actually doing it. 

You’ll see what I mean. 

It’s real hard. 

Going against the crowd takes all the strength you might have… 

… and then some. 

Most humans aren’t able to go contrarian. 

Most humans aren’t wealthy. 

When there’s blood on the streets, there’s no telling how much more there will be. 

Under such conditions, the contrarian investor lets go of his or her hard-earned money into an investment, knowing perfectly well that the Street might even value the investment tomorrow at a huge discount to today’s price.

That’s ok too, says he or she.

Why?

Because homework’s been done.

Underlying is strong.

Debt-free.

Management is stellar.

Balance-sheet is robust.

Projections are paramount.

That the world is pricing the investment wrongly is a problem with its vision.

Underlying is not going under. With above credentials, this alone matters.

Times change. Vision of the majority changes. Investor makes a killing. Cashes out some, principal and what have you. Leaves lots of free-standing shares… forever… or till parameters change.

Wealth-generators repeat this behaviour-pattern many times in their lives.

They’re not afraid of going against the grain.

They know otherwise.

Also, the money they use has been freed up.

Its being out of action for a long time is not going to change their lives even a bit.

They will have the last laugh.

Wealth is the reward of going contrarian. 

Wealth-Generators know how to Sit

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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.