Are you Positioned?

What’s our biggest enemy in the markets?

This one’s invariably…

…our Self.

Cut to ’07.

Fancy hotel banquet room, snacks and drinks, chief investment officer of JP Morgan is talking…

…and we’re listening.

My friend and I…

…sitting on profits…

…feeling smug about ourselves…

…young guns…

…ready to conquer the world…

…nothing can stop us now.

Or can it?

“There will always be a correction…”. These words catch my ear.

I raise my hand.

“Yes? The gentleman with the lime-green tie has a question?”

I stand up, and before I know it, I ask the deadly question.

“Don’t you think there’s been a paradigm-shift with regard to India, and that India has decoupled from the rest of the world?”

“How old are you, Sir?”

“37”.

This was ’07, remember?

“I’m going to excuse your question, because you’re young, and have probably experienced the markets for…?”

“3 years”.

“Exactly. That’s why I’ll only answer your question with a smile.”

How controlled.

“You see, globalization is a reality, and decoupling is a myth”.

Myth, really?

“It’s fancy phrases like “paradigm-shift” that catch the inexperienced investor’s imagination, leading to huge market mistakes”.

In these few sentences, my entire comprehension of markets was blown up and thrown out the window.

And that would have been a good thing…

…had I listened.

Such is the arrogance of “youth”, that “youth” doesn’t listen.

Soon, the ’08 crash happened.

I lost big time.

Was humbled.

Took me a long time to get back and stabilize.

I remember my stomach churning and my unwillingness to meet people as markets crashed to lower and lower levels.

I almost couldn’t take it.

We are our worst enemies.

What’s it going to be this market high?

We’ve learnt, and are positioned.

However, there will be newbies (like we were) who are going to go through this chain of events.

What buzz-words or phrases will catch their imagination?

BitCoin?

Liquidity?

Vaccine?

Quantitative Easing?

FIIs?

Pending rally in small-caps?

There’s a new cocktail doing the rounds this time around.

This cocktail will ensnare.

Even the topmost analysts are beginning to feel that a correction could take some time coming.

Some weeks ago, most felt that a correction could happen anytime now.

Player psychology is set for the cocktail to do its work.

Then one needs a pinprick.

In ’08 this was perhaps Lehman on the world scale and the Reliance Power IPO in India.

What’s it going to be this time?

It doesn’t matter.

Remember? There will always be a correction.

Are you positioned?

Washing a Stock “Sin-Free” with Cost-Free-Ness

Each stock has sins on the balance-sheet.

Many sins don’t show up even, on the balance-sheet.

You see, they’ve been swiped under the rug.

One’ll never know the whole story, unless one is the promoter oneself.

Some stocks have nothing noteworthy to hide, though.

Others have a side they don’t want you to see.

Still others are brimming with skeletons in their cupboard.

It doesn’t matter what you’re holding, …

… when you make the stock cost-free, …

… for you, the stock just became sin-free.

Congratulations.

You’re done already.

That’s the beauty of cost-free-ness.

Yeah, in cost-free-ness, …

… one has a universal balsam…

…that rinses the underlying completely clean to hold, like, forever.

Cost-free-ness is like a magic potion that turns around the whole story, …

… any story.

So, …

… what’s the motivation…

—in making the wholesome effort…

…of creating cost-free-ness?

Multibaggers, developing within our high quality, and now cost-free, holdings.

And how could one classify our feat of cost-free-ness, in another, very meaningful and currently “hot, happening and insider” way?

Nothing’s happening to one if markets go down even to zero, as far as one’s cost-free holding is concerned, since one has pulled out all the principal. Since one is not incurring any loss whatsoever from the holding, even upon market-reversal, for one, this cost-free holding, if I’ve understood Mr. Taleb (coiner and first-user of the phrase “antifragile”) correctly, is antifragile in nature, also then because, price contraction in the cost-free holding is a good thing for us, in that more purchase of the high-quality holding can subsequently happen, with the goal of making more and more holding cost-free, as markets swing back upwards. Market reversal after cost-free-ness is setting us up for a larger cost-free holding in the future. Seen from our initial sweet-spot of cost-free-ness, since market reversal betters our poise and increases our potential to make our cost-free holding grow in units (and size), that would be the last tick mark, required and now ticked, which makes our cost-free and high-quality holding, also, antifragile.

Cost-Free-Ness completely does away with Fear

When nothing from your end is invested, but you still have a holding in the markets,…

…you have created for yourself the state of cost-free-ness.

Cost-free-ness carries with itself a feeling of intense satisfaction…

…because of the sheer magnitude of the feat.

Well, congratulations.

With cost-free-ness comes absence of fear with regard to one’s cost-free holding.

When it’s not costing us, we’re not bothered.

Markets can go anywhere.

They can come down to zero, for all we care.

Fine.

Still unshaken?

Yes.

Why?

If markets comes down to zero, we can look to enter en-masse.

We’ve got principal, remember? Took it out, to create cost-free-ness, tu te souviens?

When markets come down to zero, owing to absence of fear, …

… our focus is not on our (cost-free) holding.

Instead, our focus is on the lucrative entries coming our way.

After markets come down to zero, if they do, they’ll soon reverse.

Then, our new entries will start becoming cost-free, as prices climb.

Soon, we’ll pull principal out again, and will have have new cost-free holdings, which we can transfer to our consolidated cost-free holding account.

Fear is nowhere in the equation.

From Cost-Free-Ness to a Unified, Singular, Comprehensive, 360° Market-Field-Strategy

So you’re cost-free in the markets…

…and are contemplating your further market-journey ahead.

Yeah, now what?

First-up, let’s grab a hold of what you have in your hands.

You are holding high-quality material which fits your risk- and long-term holding-profile, and, most importantly, this material has now been freed up of its investment-cost.

That’s (very) huge!

So, how does it go from here?

I’ve been here, and have always bungled it up.

This time, I won’t.

Why?

I’ve finally realized the supreme importance of being at this point, and, …

… I wish to keep coming back to this sweet-spot, …

… again, and again and again.

It’s a wonderful feeling.

One feels deep satisfaction, of achieving something big.

Yeah, at Magic Bull, we sheer achieve, write about it, and then achieve more.

We’ll just go on achieving.

We’re not stopping.

The writing part is only to keep a log and to help others on the path.

And of course, it clears one’s thoughts, making one arrive at gems of strategies…

…which all converge and unify into a singular market-approach.

Let’s talk about singular.

At this sweet-spot, the ghost of trading arrives.

One feels like riding the highs by video-gaming through the markets.

And, one falls flat.

It’s not familiar territory, because the approach till now has been one of investing, and investing and trading are diametrically opposite in nature. Meaning that it takes some time to rewire.

Before rewiring properly, …

… one’s already pressing buttons as if buttons are soon going to become extinct, since one is seeking thrills. It’s normal.

One’s achievement-vector points only towards falling flat, such is one’s behaviour.

How do we conquer this pitfall?

We’re going to exhaust this ghost’s potential to our benefit.

We are going to trade, …

… because otherwise, ghost’s not going away.

However, we are going to trade only those scrips that are already inhabiting our cost-free portfolio.

We trade these, as new units, in a different trading account.

Entry is worth one small quantum, whatever small entry-quantum one has defined for oneself.

The objective is to ride a quick run, and make, let’s say, 20% of the traded units cost-free.

That’s would be good, hard, tangible bang for our trading bucks.

Assuming we succeed, we then transfer the cost-free units to our long-term portfolio.

In the event we fail because markets start to reverse, it’s still ok.

It’s a holding we are comfortable holding, into the next market cycle, where we’ll again try and make it cost-free, and we’ll then have cost-averaging on our side, since we’ll have reversed to an investing approach.

It’s win-win everywhere.

Failure comes eventually, because markets ultimately reverse.

No one knows when.

Till them we keep trading and increasing our cost-free-ness.

When failure comes, it’s once, and eventually we hold and try to turn it around.

Because we’re holding quality, the probability of turning the situation around is high.

Before this one failure, we are poised for many possible trading wins, with each win adding to our cost-free-ness.

And there we have it…

…voilà…

… , yes, it’s a unified, singular, comprehensive, 360° Market-field-strategy…

…courtesy your friend and comrade-in-investing. …

… Magic Bull !

🙂

Using Counter-Intuition as a Buy-Sell-Tool

When the world is burning around you…

and there’s “blood on the Street”…

the last thing that one wishes to do…

…is to…

…buy.

Why?

One is afraid.

However, the most lucrative buys are the ones…

…made precisely…

…at this point in time.

Everything in our brain- and bio-chemistry will be screaming not to buy.

We will now use this state of being as a buy tool.

What?

You think I’ve let some kind of a secret out of the bag, or something?

Try doing it.

That’s the thing.

It’s most difficult to push through.

That’s also the reason very few people make big money in the markets.

Now let’s speak about exits.

Nobody really knows what’s a good exit, ever.

Why?

That’s because nobody knows the future in advance.

What we do know, is that euphoria can last long enough…

to wipe shorts out…

…as the recent shorters et al found out the hard way, in the US.

When there’s euphoria, we don’t feel like selling.

We want to make more, and more.

We feel that this can go on and on, ad infinitum.

Every bone in our body says hold on.

A sell made at this time could well nip a multi bagger in the gut.

However, our counter-intuition is speaking.

It’s already done us a service by providing us with great entries.

Let’s at least listen.

Tell you what we can do.

We can listen to it, i.e. we can exit, to some extent only.

That way, we’ll have exited and will still be in the market.

How exactly, then?

When we are feeling like this, and are experiencing prolonged euphoria…

…we can get rid of unwanted stuff.

As euphoria continues to rage, we target to make all wanted holdings cost-free, bit by bit, by exiting to that extent, ultimately and ideally.

Yes, ideally, we only want to be left holding cost-free items in the market.

From that point onwards, we don’t care where the markets are going with regard to our holdings.

It’s a sweet-spot, and we are in it because we have used counter-intuition as an effective and lucrative buying and selling tool.

Investors whine, and traders cry, when they try the other’s Art

In a breakaway bull market,…

…one starts to find faults with Trading in general…

since, to make money, one just needs to sit, rather than actively trade. 

Almost everyone is happy with their investing,…

…in a breakaway bull market. 

What kind of factors does one start pointing fingers at?

Timing.

One almost always gets this wrong, specifically with regard to futures and options, which are time-bound.

Not having enough on the table…,

…yeah, yeah, heard that one before. 

While trading, one doesn’t bet the farm. 

When one’s trades run, one makes a bit,…

…which is not, by far, as much as any odd investment portfolio would be appreciating.

Second-guessing.

While investing, one is focused in one direction. 

While trading, one looks at both directions, to initiate trades, and the market-neutral trade is another trade in a category of its own. 

Hence, one is always second-guessing the market, and when one is off, it results in opportunity loss and brokerage generation. 

Time consumed.

Trading consumes almost all of one’s time. 

When markets are closed, one’s mind is not detached. 

It’s exhausting. 

Has many side-effects too. 

One doesn’t have time for many other things, because of trading. 

Whatever one does try to participate in, consists of half-baked efforts, because essentially, one’s mind is on the market simultaneously. 

Leads to a loss in quality of life.

Now, let’s reverse the situation. 

When markets slide downwards, the trader feels light. 

He or she cuts longs and initiates shorts.

It’s a superior feeling versus the investor, who is stuck with large holdings on the table. 

Feel-good factor is huge, and quality of life gets enhanced.

Good traders don’t have a liquidity problem. 

Also, they can shut operations and switch off from the market any time, if they are able to do so, in practice. 

Tappable markets are many for the trader. 

Trading leads to income generation. 

Investing leads to wealth creation.

What do you want from your life?

Both – is a valid answer, but confuses. 

If one wants to dabble in trading, but is basically an investor, one can think about initiating positional trades, which have a investing-like feel, and one’s time is less bound to the market.

If one wants to dabble in investing as a trader, hmm, this one will be markedly tougher, I think.

Don’t know what to say here, since I’m an investor who dabbles in trading…

…, but intuitively, I feel, that this one would take a lot of effort.

Dynamics of a Right Call

India is in a long-term bull market.

Sure, there will be corrections.

We can easily have a big-time correction, but still be in the long-term bull market.

Putting things in a twenty year perspective, 2008 hasn’t done away with direction.

Sure, ideally one needed to be equity – light by Jan 14, 2008, which most of us weren’t.

Question is, will be be relatively equity-lighter on Jan 14, 2021?

Yeah, I will be.

Lighter.

That’s about it.

Won’t be selling a single share of my core-portfolio.

However, hopefully, will have sold everything else before an interim market peak.

You see, for every right call, we make umpteen wrong calls.

These are the ones that we discard on interim market highs.

We don’t discard core-portfolio inhabitants.

These we allow to compound into multi-baggers.

It’s OK to make wrong calls.

Without these, we won’t get to make the right ones.

We won’t make the next mistakes though.

We won’t discard wrong calls without it being an interim market high.

Also, we won’t discard a right call as long as we keep feeling it’s a right call.

The best calls remain right…

… like…

… almost forever.

We’re talking Buffet and Coke.

Or, for example, RJ and Titan.

List goes on.

Point is, when we’ve made the right call, we need to follow up with right actions that allow maximum mileage.

Allowance for compounding.

Increase of position upon interim lows.

Patience.

No trigger-fingers.

You get the drift.

Over time, then, we are left with right calls which have developed into multi-baggers. Wrong calls have been discarded over many interim cycles.

The multi-baggers in our folio are, at this time, generating enough dividend to sustain us.

This is where we want to be.

It’s OK to dream.

Without the right dreams, we won’t arrive at the sweet-spot mentioned above.

Happy long-term investing! 🙂

Walking the Walk

Hey,

… just made a decision…

… and am going to share it with you. 🙂

From this point onwards,…

…, I’ll exclusively be working with underlyings,…

…, with whom I’m walking the walk with.

So, what does that mean?

As per my understanding, there are two ways of getting to know an underlying, for example a stock.

We can see what it’s done,…

…, landmarks that have been established,…

…, track record,…

…, lineage,…

… etc.

Sure, we can take in the fundamentals ad-nauseam, and that’s absolutely fine.

No one’s investing without appropriate fundamentals in place.

That’s not it all, though.

Will be walking with the stock too.

Where does it go?

What does it do there?

How does it behave?

Is the behaviour off?

We want to know.

And we’ll know…

… by getting a feel for the stock’s movement.

Why all this?

What are we doing with such stocks?

Investing in them, yes.

However, stocks aren’t always in an investing zone.

Then we’ll generate income from the same stocks.

Why from this category?

Why not choose specific trading stocks to trade?

That’s because they’ll contaminate investment mindset.

Trading investment grade stocks that make one’s cut, when these stocks are in a trading zone, is a pursuit with multi-faceted advantages.

Income generation.

Pinpointed stock-specific knowledge, which gets deeper and deeper.

Insurance when stuck. You’re a holder, so do the math.

Huge time-saving in the long run, as patterns become clear.

Minimal tension.

If we wish to mimimize tension further, we can take time out of the equation (meaning, we won’t do derivatives in this case).

We won’t be Johny-on-the-spot with this strategy, probably.

We’ll make money, though.

There’ll be peace of mind.

Enjoyment.

Over time, this strategy can go to the max. Meaning, we’ll outdo all Johnies from their spots with regard to income and wealth generation.

Why?

We’re walking the walk, remember ?

Over time, we’ll become masters of our territory.

We don’t want more.

We’re done already.

Giving In

I’ve been guilty of giving in…

…to the urge to sell.

However, having kept basic tenets alive, vital underlyings are still a hold…

…for me…

…for as long as they remain vital.

Have been getting rid of stuff I don’t want.

Restructuring / reorganizing.

Consolidating.

These are the activities of choice, when markets are on a roll.

Sure, one’s been buying too, but not in the investing account.

Trading accounts are very active.

These are trading prices.

What’s the definition of a (successful) trade?

Buy high, and sell higher. Or, sell low, and buy back lower.

As opposed to an investment, where one buys low, to sell higher, later.

Are these low prices?

No.

How long has the index remained, percentage-wise, in its History, at 30+ PEs?

Very low single (%age) digits, of the time under consideration.

Thus, times will change.

Nobody knows when.

However, who cares?

Let it roll.

We’ll just go on consolidating, till we can’t consolidate anymore.

That’s the sweet spot we want to be in, before conditions change, where one can’t consolidate anymore.

And, we’ll just sheer go on trading.

That’s what we do with trading prices.

Bridging the Gap

How does one bridge the middle overs?

Sure, a blogger who is simultaneously a cricket fan…

…will dish out analogies from cricket… 🙂 … !

We’re in the business of identifying extremes…

…and acting upon such identification.

Whatever is in the middle of these extremes…

…is, for us, an area of…

…inaction.

Do we know how to not act?

There is an impulse for action in all humans.

In these loaded times, this impulse is extreme.

Why do we not want to act when an extreme is not there yet?

During times of complete pessimism, one is able to purchase underlyings for a song.

Similarly, during times of total optimism, one is able to secure good exits for stuff that one wishes to get rid of.

How one behaves in between adds or subtracts significantly to or from one’s market success.

Selling early means lesser profits, and the same goes for buying late.

This is the kind of behavior that lessens our multiple, sometimes greatly.

This kind of behavior would be absolutely ok if one were trading.

We, @ Magic Bull, are in the business of effecting multiples.

Anything coming in the way of that is behavior we wish to avoid.

With markets normally trading between extremes about 95% of the time, this leaves us with a lot of time in which we do not act.

Also, it brings us back to the pivotal question – how do we manage not to act when everything and everyone around us is screaming for action?

We do – everything – else.

Apart form market action, there’s business activity, charity ventures, extra curricular activities, family time, sport, leisure, entertainment … … one’s day is packed.

There are two portions of the day when one is driven to the edge of action, though.

The first is after studying market opening.

This is when one does a half-hour call with one’s broker and just sheer discusses everything one is observing.

Strike 1.

Then, as one studies the close, this situation can arise again.

One writes, for example.

Or, annotates charts.

Observes prices.

Collects impressions…

…and demarcates patterns.

That’s sufficient.

Strike 2.

There’s no room for strike 3 – one just doesn’t let strike 3 happen.

Secret Ingredients in Times like Corona

Hi,

It’s been a while.

Unprecedented times call for every iota of resilience that’s inherent.

Whatever we’ve learnt in the markets is being tested to beyond all levels. 

If our learning is solid, we will emerge victorious.

If there are vital chinks in our armour, we will be broken. 

Such are the market forces that are prevailing. 

Have we learn’t to sit?

Meaning, over all these years, when over-valuation ruled the roost, did we sit?

Did we accumulate funds?

Did we create a sizeable liquid corpus?

If we did, we are kings in this scenario. 

One of the main characteristics of a small entry quantum strategy is that it renders us liquidity, almost through and through. 

If we are amply liquid in the times of mayhem, there is absent from our armour the debilitating chink of illiquidity.

Illiquidity at the wrong time makes one make drastic mistakes by succumbing to panic. 

We’re not succumbing to any panic. 

Why?

Because our minds are focused on the bargains available.

The bargains are so mouth-watering, that they are entirely taking away our focus from existing panic.

To twist our psychology into the correct trajectory in a time like Corona, the secret ingredient that’s required is called (ample) liquidity. This secret ingredient is a direct result of the small entry quantum strategy, which we follow. 

Then, let’s address the other potential chink, and just sheer do away with it. 

Having access to ample liquidity, are we now greedy?

What does greed mean?

It’s not greedy to buy when there’s blood on the street, no, it’s actually outright courageous. 

Greed Is defined here as per the quantum of buying. 

Are we buying disproportionately vis-à-vis our liquidity-size and our risk-profile?

Yes?

Greedy.

No?

Not greedy.

How will we know the answer without any doubt in our mind that we have the correct answer to this question, since it is vital to our learning curve to answer this question correctly?

The answer will make itself felt.

Are we able to sit optimally even if markets crash another double-digit percentage from here?

50% from here?

No? Greedy. We have bought in a manner that doesn’t gel with our risk-profile. Our liquidity is exhausting, and focus shifts from bargains to panic. Ensuing tension amidst further fall will very probably cause us to commit a grave blunder, with this happening very probably at the bottom of the market. We are poised to lose in the markets like this. 

Yes? Not greedy. We have bought and continue to buy as per our risk-profile. We will win…

…in the markets.

The secret ingredient that locks in great prices and continues to do so as the market keeps falling, is called quantum-control as per the tolerance level of our risk-profile towards further fall. This secret ingredient ensures that liquidity outlasts a longish fall, keeping our focus on the bargains and not on the panic. This secret ingredient provides for the basic mechanism of our small entry quantum strategy.

 

My Buddy called Compounding

Compounding…

…is my happy space.

When I’m having a difficult market day,…

…I open my calculator…

…and start…

…compounding.

My friend clears all doubts in a flash.

It’s easy to compound on the calc.

In German they’d say “Pippifax”.

The younger tribe in the English-speaking world would say easy peasy…

…(lemon squeasy).

Let me run you through it.

Let’s say you wish to calculate an end amount after 25 years of compounding @ 9 % per annum.

Let z be the initial amount (invested).

The calculation is z * 1.09 ^25.

That’s it.

You don’t have to punch in 25 lines. It’s 1 line.

What if you went wrong on the 18th line?

So 1 line, ok? That’s all.

What’s ^ ?

This symbol stands for “to the power of”.

On your calculator, look for the y to power of x key, and then…

…punch in z * 1.09 (now press y to the power of x)[and then punch in 25].

What does such an exercise do for me?

Meaning, why does this exercise ooze endorphins?

Let’s say I’m investing in sound companies, with zero or very little debt, diligent and shareholder-friendly managements, and into a versatile product profile, looking like existing long into the future, basically meaning that I’m sound on fundamentals.

Let’s say that the stock is down owing to some TDH (TomDicK&Harry) reason, since that’s all it’s taking for a stock to plunge since the beginning of 2018.

I have no control over why this stock is falling.

Because of my small entry quantum strategy, I invest more as this fundamentally sound stock falls.

However, nth re-entry demands some reassurance, and that is given en-masse by the accompanying compounding exercise.

At the back of my mind I know that my money is safe, since fundamentals are crystal clear. At the front-end, Mr. Compounding’s reassurance allows me to pull the trigger.

Let’s run through a one-shot compounding exercise.

How much would a million invested be worth in thirty years, @ 11% per annum compounded.

That’s 1 * 1.11^30 = almost 23 million, that’s a 2300% return in 30 years, or 75%+ per annum non-compounded!

Now let’s say that my stock selection is above average. Let’s assume it is good enough to make 15% per annum compounded, over 30 years.

What’s the million worth now?

1 * 1.15^30 = about 66 million, whoahhh, a 6600% return in 30 years, or 220% per annum non-compounded.

Let’s say I’m really good, perhaps not in the RJ or the WB category, but let’s assume I’m in my own category, calling it the UN category. Let’s further assume that my investment strategy is good enough to yield 20% per annum compounded.

Ya. What’s happened to the million?

1 * 1.20^30 = about 237 million…!! 23700% in 30 years, or 790% per annum non-compounded…

…is out of most ballparks!!!

How can something like this be possible?

It’s called “The Power of Compounding”…,

…most famously so by Mr. Warren Buffett himself.

Try it out!

Pickle your surplus into investment with fundamentally sound strategy.

Sit tight.

Lo, and behold.

🙂

Have the Guts?

Somebody did say …

… that Equity was not for the faint-hearted.

Oh, how true!

Everyday, my heart stands tested!

However, because of a small entry quantum strategy, I am able to stay in the game.

If I am able to stay in the game for multiple cycles, I will prosper.

Why?

Firstly, the strategy by default renders me liquid, such are its tenets.

Then, a good hard look at fundamentals is always called for.

To close, it is important is to enter with technicals to support you.

Now let’s say I make a mistake.

What is a mistake?

Ya, good question – in the markets, what is a mistake?

In the markets, when the price goes against you, you have made a mistake.

So let’s say that I’ve made a mistake.

Is the mistake big?

No.

Why?

Because of my small entry quantum.

What does it mean for my next entry?

Added margin of safety.

Is that good?

You bet.

Why?

Because fundamentals are intact.

What’s going to eventually happen?

Stock’s going to bottom out.

I’ll have a decent amount of entries to my name.

My buying average will be reasonably low.

The margin of safety my buying average allows me will let me sit on the stock forever, If I wish to.

Down the road, one day, I might be sitting on a big fat multiple.

Please do the math.

Happy and lucrative investing!

🙂

Behaviour at the Sweet Spot

When you’re active,…

…happy,…

…at your financial goal,…

… and looking to go beyond,…

…what is this condition called?

It’s called…

…being at the sweet spot.

Stop here.

Enjoy it. 

It’s come after toil.

Don’t let is go.

Whatever you do from this point onwards, maintain the existence of the sweet spot.

If you’re careless, the sweet spot will be gone…

…and you’ll be back in the rut. 

If you don’t know how to behave at a sweet spot…

…you’ll most certainly see it go.

So…

…how does one behave at a sweet spot?

First up, don’t make too many moves here, because balance is brittle and has come at a cost. 

You’ve moved your mountains to reach here. Movement is done. 

Savings will emanate at the sweet spot. 

Tap these. 

Do whatever it is you wish to do from a part of these savings. 

As your savings grow further, detach yourself more and more from the rat-race. 

The sweet spot was the one where you told yourself you’d be happy. 

Beyond, you should be happier. 

Make sure that comes true for you.

Happy Living!

It has to be a Dunk

When I shoot…

… it has to be a dunk.

If I’m not getting a dunk in…

… I’m not shooting.

What are the implications?

Imagine only taking market dunks for multiple decades in a row.

Where do you think that’s going to leave you?

Most of the time, though, one’s not shooting.

That’s because, most of the time, dunk trajectoires are not available.

When one is not shooting, does it become boring?

Only if you let it.

Yeah, just don’t let it.

No action is a good thing.

It saves resources.

Then, when opportunity is available, one might get twenty dunk days in a row.

Things can get so active, that one wants activity to normalize again, if not stop for a while.

Actually, not a challenge.

I’ll tell you what is a challenge…

… for me.

Dunk opportunity…

… and travel.

I don’t like this combination.

How do I deal with it?

First up, what don’t I like about it?

Distraction.

Not doing full justice to the trip.

Not doing full justice to the investing opportunity either, as in distracted due diligence.

Hmmm.

What do we do here?

Sure, you’ll argue, today one carries one’s terminal where one goes.

Does one also carry one’s zone, you know, the magical frame of mind, from within which one takes magic decisions?

Very probably not.

When one takes an investment decision, is it not better to be in this magical zone?

Therefore, unless the opportunity is just too pressing, such that it makes me open my terminal even during travel, …

…, yeah, my terminal mostly stays shut when I’m on the move, …

…, because then it’s time to do other things. Yayyyyy!

😀

Boiling Down to Unity

What is unity?

Oneness.

The thing everything has boiled down to.

That, which emerges after all the dust of everything has settled.

Yes, that.

Not the one as in being united, not that unity.

The one-resultant-vector unity.

The equation-being-solved-unanimously unity.

The one big solution for everything that’s bothering you – that unity.

Why are we talking about unity?

Because it is the answer.

What is the question?

Or, what are the questions?

“It’s the question that drives you, doesn’t it, Neo?”

There are many questions.

Each has different questions.

Each strives for a unique unity.

Each must find his or her unique point of peace.

Till then, mind will be restless, something will always be missing, and peace will be elusive.

Are we even talking about money?

You bet.

We strive in a million ways to garner money and make it grow.

We try different methods. Lots of strategies. People. Planning.

What is it boiling down to?

Have we recognised it?

In what form do we wish to see our money ultimately?

Do we have that kind of vision?

Are we standing on the mountain with that bird-eye view?

If yes, our strategies start culminating towards the final goal.

Why?

Because we know where we are going.

How did we know where we were going?

We asked the question.

Then we followed our mind. It led us to the answer.

Took some time, didn’t it?

At least we got there.

That’s huge.

Auto is our Motto

What are you doing…

…that’s not on auto?

Next question is, why is it not on auto?

On purpose?

Sure, there’s some stuff that you’d like to reserve for manual. That’s absolutely fine. 

Not on purpose?

Meaning you want it to be on auto, but haven’t done so?

Right. 

Why not?

Meaning, why are you not using that one big benefit of the twenty-first century – to your benefit?

Lazy?

Couldn’t care less?

Too complicated?

In a rut?

Whatever. 

Bottomline is, you’re losing out. 

How?

You’re losing out on…

…time…

…growth…

…evolution…

…prosperity…

…sense of fulfilment…

…sense of purpose…

…and what have you.

You can also start figuring out for yourself how you are losing out on these things amongst other stuff. No spoon-feeding here. 

Automation is the minimal requirement of our times. 

Automation requires transcending an activation barrier. 

This is a one-time input, before the concerned process goes on auto. 

This is also the step which makes many lose interest in going auto. 

Well, from nothing comes nothing. 

You will have to put in that time and energy for the one-time input that pushes the process into auto-mode. 

There is no way around it. 

However, each time you’ve gone auto, you’ll get a huge sense of accomplishment. 

You’ll want to recreate that feeling again and again and again. 

You’ll want to put more and more stuff on auto. 

With so much of auto stuff adding to you from the background, your life will become fuller. More enjoyable. More time to pursue whatever you wish to pursue. More time to be…

…you.

Cheers. 

Saturation

I don’t wish to add to my repertoire.

It has reached some kind of saturation. 

There’s no limit to how far I can go within my repertoire.

However, it is not comfortable with strategy addition. 

Fine. 

Did you just have this dialogue?

With yourself?

It’s good you did. 

While you start out in a field, you’re developing it. 

There needs to come a stage, in a while, where you have exactly identified, that you’re developing this, this and this further. Nothing else. 

Once you know what the exact game is, all your focus is required to take it to the nth level. What that n is going to be is up to you, again. 

Bottomline is, after a point, know your game. 

This is the game. 

This is what you are scaling up. 

That, that, that and that you are discarding, or have discarded. 

You need to reach this point within a reasonable time-frame. 

Then comes the next step. 

Pray, what might that be?

Automation. 

Before embarking upon scaling up, that what remains in your saturated repertoire – automate it. 

Staff. 

Technology. 

What have you.

Use any means for automation. 

Anything that’s legit, and which works. 

Use it. 

Standing instruction. 

Alarm. 

Alert.

Whatever. 

Automation is a huge blessing if used properly and after having tied up all the loose ends. 

If implemented in a hurry with sieve-like loopholes, it can even take you to the cleaner’s.

Implement automation in a justified and sure-shot fashion. 

Do you know what’s going to happen now?

You have created a situation, where scaling up means just punching in an additional 0 in the right corner, before the decimal point. 

Wow.

After a while, the complete field will be on auto. 

Why?

If you’re wise, you won’t scale up beyond your sweet-spot. 

Why?

Because obnoxious scales come with obnoxious problems.

What’s obnoxious?

Anything beyond your sweet-spot…

…is obnoxious. 

What is your sweet-spot?

That only you can discover. 

So what now is the exact status of the field?

Your repertoire in the field has reached complete saturation regarding strategy and scale. It is on full auto. It is adding to your well-being without you batting an eye-lid. 

Congratulations. 

However, where does that leave you?

Is that even a question?

There’s so much to do in the world. 

Discover a new field. 

Develop your new repertoire in this field. 

Take it to strategy saturation. Automate it. Scale it up. Take it to the sweet-spot. Wean off the scaling up. Move on. 

What a life it’s going to be for you!

Small Shoots to Big Trees

What do I see around myself?

Lots of small shoots. 

Wherever I look, there are small shoots. 

Does this make me happy?

You bet. 

Why?

Why not?

I mean, you don’t see any trees. 

So?

You’ve been at it for a while.

So?

All you’re seeing is shoots. Does that satisfy you? None of your efforts is a big tree in all this while.

That’s a very narrow-minded, greedy and fast-buck remark. 

Explain. 

For each of the shoots I see around me, twenty efforts have died their death. However, one shoot managed to entrench itself. This one shoot is firm, and goes very deep into the ground. It’s roots have become very strong. It is now ready for the world and has decided to show itself over the ground.  Over the next many, many years, with my meticulous nurturing, this very shoot shall grow up into a mammoth tree with unprecedented positive consequences.

I see. And, you’re saying that you see many such shoots around yourself?

Yes, many many.

Wow.

Yeah, i’ve been busy. I’ve tried and discarded many things. What remained didn’t want to leave me. It got planted and grew roots. Now that the shoots are growing, they are mostly on auto-pilot. Some need tending to once a day, some once a week.

Does that give you empty spaces in between?

Yes.

How do you fill these empty spaces?

I do, and I don’t.

Meaning?

Unless something new refuses to leave me, I don’t wish to plant another tree.

Why?

I’m happy enough tending to what I have.

So you’ve reached the…what’s that called?

Sweet spot?

Yes, you’ve reached the sweet spot. But nobody knows about you. You’re not famous or anything.

That’s why the spot is sweet.

Meaning?

Nobody disturbs my privacy. I can go where I choose. Do what I want. I don’t need to share my time with anyone if I don’t want to. There are no compulsions imposed upon me. 

Do you think you will be famous one day?

When these shoots grow into big trees, that might happen.

Do you want it to happen?

I want my trees to grow. Not sure today about fame. It kills personal life. I like my life and its pace.

Any regrets?

Sometimes, I get lonely. It’s the nature of the path. Despite family and a decent social life, loneliness is still there. Applied finance requires a lot of alone-time. 

How do you deal with that?

I start tending to a different shoot. Financial. Non-financial. Recreational. Creative. Gap gets bridged, and then the loneliness is gone. 

Holding the Line

Your systems are in place.

They’re implemented. 

Basics are going. Life basics. Family basics.

Then you’ve got your income basics. They’re safe. They generate income. This income goes towards comfortable upkeep of your family. Some of it is saved. 

Your investment portfolios are firing. Savings have built these up. You don’t touch these, but keep adding to them upon opportunity. 

You’ve just finished implementing all your trading systems. 

Some of these are on auto-pilot. 

The other ones demand a little of your time each day. 

They keep you sharp and all there. 

Nothing much. 

Just fifteen to twenty minutes each. 

Skin off your teeth. 

You tackle them with your bed-tea. 

In other words, you are set as far as being income plus plus plus. 

Good. 

Now what?

Now you need to hold the line. 

What does that mean?

It means everything. 

It means no blow-ups…

…no crazy decisions that impact folios and family…

…basically nothing insane coming from you that will threaten your hard-earned situation or worse. 

Holding the line means making sure basics stay intact…

…folios keep growing…

…and new systems keep developing that add to these. 

It’s really that simple. 

When you hold the line, your next step either maintains status quo or adds to you. Preferably, it adds to you.

However, the simpler something is, the more difficult it is to follow. 

What are the demons that can slay you?

Over-confidence.

Over-ambition.

Hubris.

Greed.

Showmanship. 

Debt.

One-up-on-the-Joneses-ideology. 

This stuff looks pretty harmless at first, but is enough to give rise to cracks. 

Cracks grow… 

…till you’ve either come back to your senses and filled and sealed them…

…or till they’ve destroyed you right down to beyond your basics. 

Yeah, a full blow-up is never really far away, once cracks start to appear. 

Therefore…

…while holding the line…

… you keep reminding yourself about what you’re doing…

…why you’re doing it…

…and that you’re never going to blow up, come what may…

…and that you’re going to keep holding the line, come what may…

…and that your next step is always going to add to you.

Happy Holding!

🙂