Yup, autocorrect. 😅
More from Sahil Sharma
Given the immense interest in this #investment #process thread about how to get investment ideas, thought of creating a logical follow-up 🧵
Given that I have an idea & some sense for valuation & growth, how do i construct a portfolio?
If you like the thread, plz RT.
First thing worth mentioning is that I am only describing my own process. Others can follow a different process which could work for them.
Opposite of a good idea can also be a good idea
Before understanding the process itself, it is important to understand the problems the process is being designed to solve for. What are the key hurdles or troubles I have faced in designing my PF.
Hurdles
1. At any given point in time (in the past) i have only known deeply about 5% of the listed universe in India, or lower. When I say know deeply I mean read an annual report, an investor presentation, a concall, understood why the business is how it is.
2. I only started my corporate life 4 years ago, so my pf size is small compared to yearly savings. This means that I need to deploy large incremental capital every year at least for next few years. This cant be a buy & track pf, this is a keep buying & tracking for a few yrs pf
Given that I have an idea & some sense for valuation & growth, how do i construct a portfolio?
If you like the thread, plz RT.
A lot of people ask: how do you find companies to invest in? very good question.
— Sahil Sharma (@sahil_vi) July 6, 2021
How did you find RACL, Pix?
Creating this ad-hoc thread to share my process.
if you like it, please RT to benefit maximum investors. \U0001f64f
First thing worth mentioning is that I am only describing my own process. Others can follow a different process which could work for them.
Opposite of a good idea can also be a good idea
Before understanding the process itself, it is important to understand the problems the process is being designed to solve for. What are the key hurdles or troubles I have faced in designing my PF.
Hurdles
1. At any given point in time (in the past) i have only known deeply about 5% of the listed universe in India, or lower. When I say know deeply I mean read an annual report, an investor presentation, a concall, understood why the business is how it is.
2. I only started my corporate life 4 years ago, so my pf size is small compared to yearly savings. This means that I need to deploy large incremental capital every year at least for next few years. This cant be a buy & track pf, this is a keep buying & tracking for a few yrs pf
More from Ds
1/
Get a cup of coffee.
In this thread, I'll walk you through 2 probability concepts: Standard Deviation (SD) and Mean Absolute Deviation (MAD).
This will give you insight into Fat Tails -- which are super useful in investing and in many other fields.
2/
Recently, I watched 2 probability "mini-lectures" on YouTube by Nassim Taleb.
One ~10 min lecture covered SD and MAD. The other ~6 min lecture covered Fat Tails.
In these ~16 mins, @nntaleb shared so many useful nuggets that I had to write this thread to unpack them.
3/
For those curious, here are the YouTube links to the lectures:
SD and MAD (~10 min): https://t.co/0TwubymdE6
Fat Tails (~6 min):
4/
The first thing to understand is the concept of a Random Variable.
In essence, a Random Variable is a number that depends on a random event.
For example, when we roll a die, we get a Random Variable -- a number from the set {1, 2, 3, 4, 5, 6}.
5/
Every Random Variable has a Probability Distribution.
This tells us all the possible values the Random Variable can take, and their respective probabilities.
For example, when we roll a fair die, we get a Random Variable with this Probability Distribution:
Get a cup of coffee.
In this thread, I'll walk you through 2 probability concepts: Standard Deviation (SD) and Mean Absolute Deviation (MAD).
This will give you insight into Fat Tails -- which are super useful in investing and in many other fields.
2/
Recently, I watched 2 probability "mini-lectures" on YouTube by Nassim Taleb.
One ~10 min lecture covered SD and MAD. The other ~6 min lecture covered Fat Tails.
In these ~16 mins, @nntaleb shared so many useful nuggets that I had to write this thread to unpack them.
3/
For those curious, here are the YouTube links to the lectures:
SD and MAD (~10 min): https://t.co/0TwubymdE6
Fat Tails (~6 min):
4/
The first thing to understand is the concept of a Random Variable.
In essence, a Random Variable is a number that depends on a random event.
For example, when we roll a die, we get a Random Variable -- a number from the set {1, 2, 3, 4, 5, 6}.
5/
Every Random Variable has a Probability Distribution.
This tells us all the possible values the Random Variable can take, and their respective probabilities.
For example, when we roll a fair die, we get a Random Variable with this Probability Distribution:
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I just finished Eric Adler's The Battle of the Classics, and wanted to say something about Joel Christiansen's review linked below. I am not sure what motivates the review (I speculate a bit below), but it gives a very misleading impression of the book. 1/x
The meat of the criticism is that the history Adler gives is insufficiently critical. Adler describes a few figures who had a great influence on how the modern US university was formed. It's certainly critical: it focuses on the social Darwinism of these figures. 2/x
Other insinuations and suggestions in the review seem wildly off the mark, distorted, or inappropriate-- for example, that the book is clickbaity (it is scholarly) or conservative (hardly) or connected to the events at the Capitol (give me a break). 3/x
The core question: in what sense is classics inherently racist? Classics is old. On Adler's account, it begins in ancient Rome and is revived in the Renaissance. Slavery (Christiansen's primary concern) is also very old. Let's say classics is an education for slaveowners. 4/x
It's worth remembering that literacy itself is elite throughout most of this history. Literacy is, then, also the education of slaveowners. We can honor oral and musical traditions without denying that literacy is, generally, good. 5/x
As someone\u2019s who\u2019s read the book, this review strikes me as tremendously unfair. It mostly faults Adler for not writing the book the reviewer wishes he had! https://t.co/pqpt5Ziivj
— Teresa M. Bejan (@tmbejan) January 12, 2021
The meat of the criticism is that the history Adler gives is insufficiently critical. Adler describes a few figures who had a great influence on how the modern US university was formed. It's certainly critical: it focuses on the social Darwinism of these figures. 2/x
Other insinuations and suggestions in the review seem wildly off the mark, distorted, or inappropriate-- for example, that the book is clickbaity (it is scholarly) or conservative (hardly) or connected to the events at the Capitol (give me a break). 3/x
The core question: in what sense is classics inherently racist? Classics is old. On Adler's account, it begins in ancient Rome and is revived in the Renaissance. Slavery (Christiansen's primary concern) is also very old. Let's say classics is an education for slaveowners. 4/x
It's worth remembering that literacy itself is elite throughout most of this history. Literacy is, then, also the education of slaveowners. We can honor oral and musical traditions without denying that literacy is, generally, good. 5/x
