It's the weekend!
Grab a cup of coffee, in this thread I will explain
1. How to do Industry Research?
2. How to research a Company from scratch?
3. How to determine Margin of Safety and build an Investment Case?
Lets dive right in.
Read, Read and then Read some more.
The more knowledge you consume, the better you will be able to identify and link trends across industries.
Your reading and research needs to be structured.
This is where technology comes in to help and make our lives easier.
Be it Instagram posts, TikTok reels or YouTube videos.
So learn to trick these algorithms and use them to your advantage.
That account is not used to subscribe or watch to any other content - no music, no vlogs, no movie trailers, no fun stuff.
This way I discover new content without really doing any work to find it, the algorithm does all the hard work for me.
Most of these companies occasionally publish free to read detailed reports on a particular industry or sector
That was my introduction to companies like Vinati, Navin, Aarti and Deepak.
Here is a link to that report
Here is a link to that report
Here is a link to that report
This document in India is called RHP (Red Herring Prospectus) and in US is called S-1.
SEC - EDGAR (US)
Collect them and over time you will build a nice repository of industry specific content.
1. Where to Look
2. What to Look For and
3. How to Leverage Technology to your advantage
Practicing the above, finding, reading and learning from good and credible content will.
All you're trying to do is gather and consume as much information as you can.
Look for mission statement of the company - what does it want to accomplish.
Understand what industry it operates in, what are its products, what it is selling and who runs it.
All you're looking for at this stage is basic information.
Your next source of information should be Credit Reports.
These are free reports issued by credit agencies and contain valuable information into the state of the company and the industry.
You are now looking for its past events and future prospects.
This is where quarterly conference calls helps.
This gives me enough idea about
1. Current problems with the company
2. What's working for the company
3. Where is it planning to go in future
Pick up the latest available annual report and directly jump to the section called "Management Discussion and Analysis".
Once you're done with this section, you can read Chairman's and CEO's comments and other sections of the annual report.
Its now time to look at the numbers.
Learn to take this data with a pinch of salt as no company will criticize itself in its own investor presentation.
The more notes you make, the better you will be able to connect the dots and find patterns.
Pattern like these will begin to emerge as you research more.
Understand what they are doing, follow the entire process from above with these companies.
Doing this alone will put you ahead than 99% of investors in the market today.
1. You know about the industry
2. You know about the company
3. You know about the peers of the company
Its time to build an investment case.
Is it cause investing in this opportunity suits your risk and return profile or just cause you have done so much research.
Invest cause of the former and not for the latter.
If you require a return of 20% a year with low volatility then at this stage you will have to determine and understand if the opportunity to invest in this company fits into these goals.
Lets assume the market cap today = 10,000cr
Your required return is 20% per year for next 5 years which means the market cap of the company 5 years later needs to be 25,000cr.
1. Earnings and EPS of the company increases
2. The multiple commanded by the company in the market increases
We need to look at Sales, Operating Profit, EPS and determine if these will grow at 20% or more in next 5 years.
The triggers for growth can be capacity expansion, new higher margin product launches or increasing market share.
We need to look at Operating Profit Margin commanded by the company today
If the margin earned by the company expands from a single digit (5%) to double digits (25%) and if these margins are sustainable then market will start giving a higher multiple to this company.
In case of Intellect, look how the sales haven't really increased a lot but margin went from 6% to sudden 24%.
Result was Intellect being a 15 bagger since March'20. .
Intellect in its concalls was guiding for a margin increase, its just that no one was paying attention to Intellect and reading those concalls.
Whoever was, made 15x in one year.
It helps me determine the industry structure and how a company stands within it.
You can learn more about it in this thread below.
Its the weekend!— Tar \u26a1 (@itsTarH) June 12, 2021
Grab a cup of coffee, in this thread I will explain
1. What are Porter's 5 Forces?
2. How to use them while analyzing a business?
3. What information can they tell you about a business
We will be analyzing Divis Labs as an example.
Lets dive right in. pic.twitter.com/Si03K4Q5I8
Based on all the research you did earlier you can determine a fair multiple to give to the company.
Look at peers of the company and examine the multiple they are getting and why.
An example of this Margin of Safety is Jubilant Ingrevia.
My buying reason was the massive discount to the company compared to its peer Laxmi Organics.
Investing for me is a second full time job and one that rewards quite handsomely for the efforts.
You need to build one for yourself and unless you put a method to this madness, your returns will never be extraordinary.
I hope this thread helps you to build an investment framework for yourself.
You can learn all about it in this thread below.
I teach a small class of Data Visualizing using a Free tool called Tableau over @skillshare
Get access to the class by using the below link
Here is a link to that class.
Subscribe for free, if you're interested.
Thank you to the 2500+ of you who already have!
I write a new thread every weekend.
All my previous work, can be found here.
All my Threads so far \U0001f9f5 \U0001f447\U0001f3fc— Tar \u26a1 (@itsTarH) June 5, 2021
More from Tar ⚡
Recommending all of them 👇🏼
Billion Dollar Whale is a fascinating story about how one mastermind was able to rob billions of dollars from Malaysian Sovereign Fund and use that money to finance everything from parties with Paris Hilton to the movie Wolf of Wall Street.
Thrilling and Insightful 💰
Joys of Compounding by @Gautam__Baid teaches you various aspects of the magic that is compounding.
From finance to more importantly how compounding lessons in life play an important role.
This one has both lessons in life and investing packed into one.
Highly recommended 🌱
In The Plex give you an inside view on how one of the greatest companies in the world - Google, works.
Steven Levy is one of my favourite authors 🔍
If you're a fan of history and geopolitics then this one is for you.
The Rise and Fall of Nations by Ruchir Sharma has to be one of the best books written on global political landscape and the rules that govern them today. 🌇
Jubilant Ingrevia has broken Channel and RSI support for the first time since listing
In the absence of any immediate short term triggers, a sideways to down move is more likely than further upmoves.
Q. Am I selling?
A. No, I do not sell long term stocks
Q. Am I buying?
A. No, I am not
Q. When will I buy?
A. I don't know
Q. What is my Stop Loss?
A. I don't have any
Q. What is my Avg price?
A. Less than 350
Q. How to handle volatility?
A. I live for it
Market is short sighted and loves to buy high and sell low
Sequent is a long gestation stock, it won't deliver it's real earnings until FY23-25
Not suitable investment for those who want 100% return/yr
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Arts are best form to Express thoughts & devotion. In All civilization Arts played very important role to express sprituality. Tibbeten Tangkhas are prime example .
List of My Paintings & Sketches
प्रलय पयोधि-जले धृतवान् असि वेदम्
विहित वहित्र-चरित्रम् अखेदम्
केशव धृत-मीन-शरीर, जय जगदीश हरे!!
छलयसि विक्रमणे बलिम् अद्भुत-वामन
केशव धृत-वामन रूप जय जगदीश हरे
नंदसि यज्ञ- विधेर् अहः श्रुति जातम्
केशव धृत-बुद्ध-शरीर जय जगदीश हरे
क्षत्रिय-रुधिर-मये जगद् -अपगत-पापम्
स्नपयसि पयसि शमित-भव-तापम्
केशव धृत-भृगुपति रूप जय जगदीश हरे
What is pyramiding?
It is simply adding to your winners.
Why use pyramiding?
1. It makes your winners bigger than your losers.
• Because you are adding positions when your trades are going your way, you are increasing your gains but your losers will be small comparatively.
2. You lose less during Draw-down time ( it saves you from losing big during whipsaws )
• Many times when the market is in sideways mode, Entering a trade with full risk might not be the best idea.
• So, you test the waters with a small position first, it could be ⅓ or ¼ of your total risk.
• So if the Breakout fails or whipsaws come, then you will only lose a small part of your overall risk.
• Then when position starts to go in your favor you can add to it.
3. It helps you to concentrate on a few trades,
They say that don’t put all your eggs in one basket, but don’t put them in too many either.
• See, Everyone can see charts and find breakouts, pullbacks etc.
These names are from Sri Vishnu Sahasranama!
|. "Om Vashatkaaraaya Namaha" : For Success in Business.
||. "Om Aksharaaya Namaha" : For Success in Studies.
|||. "Om Bhuthabhavanaya Namaha" : For Good Health.
|V. "Om Paramaathmane Namaha" : For Self Confidence.
Src: VAK magazine from Chilkur Balaji Temple, Hyderabad - Sri @csranga
#SanatanaDharma #SanatanaSanskriti #Sattology
One needs to chant the following slokas 28 times to get rid of certain problems in life.
Om Hrushikesaya Namah - For Overcoming Bad habits
Om Vashatkaaraya Namah - For Success in Business, Interviews, visa interviews, building relationships
Om Srimate Namah - For Handsome appearance & wealth
Om Aksharaya Namah - For Education & better financial strength
Om Paramatmane Namah - For self employed people, for promotions and success in games.
Om Putatmane Namah - To remove mental stress & for mental peace
Om Sarmane Namah - For Job Satisfaction
Om Bhutadaye Namah -To amend soured friendship or any personal relationship
Om Dhatre Namah - For issueless couple
Om vidhatre Namah - Pregnant Ladies to Chant for healthy babies.
Chant the following 108 times :
In Vedic literature, one of the most frequent names of Rudra is शर्व ("archer").
Yajurveda 4.5 (Taittiriya Samhita) is popularly known as Shri Rudram or Śatarudrīya
Its fifth Anuvaka starts with
नमोभवाय च रुद्राय च नमः शर्वाय च पशुपतयेच
Infact, the Śatarudrīya starts with:
नमस्तेरुद्रमन्यव उतोत इषवेनमः ।
नमस्ते अस्तुधन्वनेबाहुभ्यामुततेनमः ॥
"Veneration to your wrath, O Rudra. Veneration to your arrow as well; Veneration to your bow and veneration to your arms" (Yajurveda 22.214.171.124).
The bow of Rudra was पिनाक
In fact, in the entire Vedic literature, triśūla is not mentioned anywhere as the weapon of Rudra-Śiva. This is only mentioned in Post Vedic literature(Epic and Puranic)
Likewise, God Apollo is renowned in Ancient Greek literature as "The Archer".
In Illiad (c. 800 BC), The most frequent phrase used by Homer to describe Apollo is "Apollo who shoots from afar"
While the condition is primarily caused by physical changes to the brain matter, heavily dependent on one's age, genetic risk, family history or if injuries to the brain, the kind of lifestyle you lead, dietary deficiencies may also increase one's chances of developing dementia.
If there is one single factor which can increase your chances of cognitive decline, poor brain health and accelerate ageing, it has to be the lack of Vitamin B12 in our diets.
Poor levels of Vitamin B12 can induce symptoms like memory loss, aggravate development of dementia in individuals. While it does not have a direct impact on memory function, Vitamin B12 is an important nutrient to be included in your everyday diet.
While we are increasingly hearing of rising heart attacks amongst the young, experts have also said that poor diligence and attention to heart health, following poor cardiac preventive measures can also raise a person's risk of cognitive decline and issues like dementia.
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Always. No, your company is not an exception.
A tactic I don’t appreciate at all because of how unfairly it penalizes low-leverage, junior employees, and those loyal enough not to question it, but that’s negotiation for you after all. Weaponized information asymmetry.
Listen to Aditya
And by the way, you should never be worried that an offer would be withdrawn if you politely negotiate.
I have seen this happen *extremely* rarely, mostly to women, and anyway is a giant red flag. It suggests you probably didn’t want to work there.
You wish there was no negotiating so it would all be more fair? I feel you, but it’s not happening.
Instead, negotiate hard, use your privilege, and then go and share numbers with your underrepresented and underpaid colleagues. […]
One of those strategies which I like is Iron Fly✈️
Few important points on Iron fly stategy
This is fixed loss🔴 defined stategy ,so you are aware of your losses . You know your risk ⚠️and breakeven points to exit the positions.
Risk is defined , so at psychological🧠 level you are at peace🙋♀️
How to implement
1. Should be done on Tuesday or Wednesday for next week expiry after 1-2 pm
2. Take view of the market ,looking at daily chart
3. Then do weekly iron fly.
4. No need to hold this till expiry day .
5.Exit it one day before expiry or when you see more than 2% within the week.
5. High vix is preferred for iron fly
6. Can be executed with less capital of 3-5 lakhs .
https://t.co/MYDgWkjYo8 have R:2R so over all it should be good.
8. If you are able to get 6% return monthly ,it means close to 100% return on your capital per annum.
Zuckerberg says FB is in the process of setting up a "new independent body" that users will be able to appeal content takedowns to. Sort of like the "Facebook Supreme Court" idea he previewed earlier this year.
Zuckerberg: "One of my biggest lessons from this year is that when you connect more than 2 billion people, you’re going to see the good and bad of humanity."
This is how Facebook says it's trying to change the engagement pattern on its services. https://t.co/3p0PGc912o
[email protected] asks Zuckerberg if anyone is going to lose their job over the revelations in the NYT story. He dodges, says that personnel issues aren't a public matter, and that employee performance is evaluated all the time.
2/ “Being a VC” can mean a lot of different things, so it’s worth asking:
What actual activities do you want to do?
- Deep market analysis?
- Be in the flow of information and people?
- Make deals?
- Work closely w/ founders over time (e.g take board seats?)
- Manage capital?
3/ It’s worth specifying what type of VC you might like to become — as there are different archetypes. E.g.
- Benchmark (Lead series A/B - couple investments a year)
- First Round (Lead seed rounds, partner w/ a few companies a year)
- SV Angel (Make lots of seed investments)
Expa - Incubate companies
YC / Village Global - Build a platform to help entrepreneurs at scale
Do you want to join a firm or start one? There’s a lot to consider.
Different paths will require different skillsets & sets of experiences.
5/ Since the person who wrote the email is a young person trying to break into VC by joining a firm (and who doesn’t want to start a company), I’ll tailor this tweet storm to that goal. There’s some overlap.
(Thread👇) Tell us if you can relate to any of these? Do you have your own values that guide your decisions? Share them with us! ⛳
0. Coder != engineer
Coders focus just on writing code to make something work. Engineers take a much wider view, focusing on both the problem and every aspect of the solution. 🤓
1. “Import lib”
It's not wise to waste time building tools or libraries if there’s already something that does the same job! Wherever possible, extend existing libraries and contribute back to the community. 💁♀️
2. With great power comes greater responsibility
Every choice we make on our platform and every feature we build stands up to a responsibility — helping people make more data-driven decisions and bring about real change for millions of people. 💪
3. Fail fast and keep learning
Failing fast is about doing lots of fast iterations and learning from each, rather than getting stuck on one solution or decision. 👊