Here are some of the big investors that track:

Altarock Partners
AKO Capital
Appaloosa
Akre Capital
Broad Run
Dorsey Asset
Duquense
Ensemble
Fundsmith
Polen Capital
Third Point

Here are their current top 10 holdings (in order) and links to their latest buys/sells ⬇️

Panic selling once can destroy years of good investment decisions in an instant

but keeping your head on straight when your portfolio is tanking is hard

Here are 13 investing tips/tricks/principles that I use to keep calm when my portfolio is in free fall:

1/ Know what you own and why you own it

You can borrow stock ideas from other investors, but you can’t borrow conviction

You must understand the bull AND bear case upfront, otherwise you won’t have the conviction to hold when the price is going down

Research builds conviction

Conviction enables patience

Patience builds wealth

If a 20% drop shakes your confidence in a business, you didn’t do enough research

2/ Know what drives long-term stock returns

In the short-term, emotions & computer algorithms determine stock prices

In the long-term, profit growth determine stock prices

This is a core investing principle that you must fully embrace

Look at these long-term charts of $MSFT, $HD, and $AAPL

Net income growth & stock price growth are closely linked in the long-term

That’s not a coincidence — profit growth IS WHAT DRIVES long-term value creation

I asked, “What company is worth less than $10 billion today but you think could be worth $500+ billion in a few decades?”

I received 710 answers

Here are 20 top stocks that have 50x+ potential:

1: Alteryx - $AYX

Market cap: $5.1 billion

What it does: Big data analytics

2: Boston Omaha - $BOMN

Market Cap: $900 million

What it does: Berkshire Hathaway 2.0

3: Beyond Meat - $BYND

Market Cap: $7.9 billion

What it does: Plant-based meat

4: Desktop Metals - $DM

Market Cap: $2.3 billion

What it does: 3D Printing

I asked, “What book do you re-read the most?”

I received 441 replies

Here are 20 books that should be read again and again:

1/

7 Habits of Highly Effective People

by Steven Covey

2/

A Short History of Nearly Everything

by Bill Bryson

3/

As A Man Thinketh

by James Allen

4/

Atomic Habits

by @JamesClear

1/ An ode to @JeffBezos

Jeff is stepping down from CEO and moving on to Executive Chairman

He's one of the greatest owner/operators of all time

$10,000 invested in $AMZN at IPO is currently worth

$17.3 million!

Here's a list of my favorite Bezos facts and quotes 👇

2/ "We don’t celebrate a 10% increase in the stock price like

we celebrate excellent customer experience.

We aren’t 10% smarter when that happens

and conversely

aren’t 10% dumber when the stock goes the other way."

3/ Bezos invested $250,000 in Google in 1998

That's worth several BILLION dollars today

4/ "Your margin is my opportunity"

5/ "There are two kinds of companies,

those that work to try to charge more

and those that work to try to charge less.

We will be the second."

Worried about the recent market drop?

Here are 24 top investing quotes from Buffett, Bogle, Graham, and more that can help🧵

"If you have trouble imagining a 20% loss in the stock market, you shouldn’t be in stocks."

-- John Bogle

"Opportunities come infrequently. When it rains gold, put out the bucket, not the thimble."

-- Warren Buffett

“Individuals who cannot master their emotions are ill-suited to profit from the investment process”

-- Benjamin Graham

"A calm sea does not produce a skilled sailor."

-- Tom Culve

1/

Get a cup of coffee.

In this thread, I'll help you understand Geometric Expectations.

2/

Imagine we have an investment opportunity.

If the investment goes well, we get to double our money.

But if it goes badly, we'll end up losing three fourths of it.

There's a 50/50 chance of either outcome.

The question: is this a good bet or not?

3/

A simple way to approach this question is to calculate the bet's "expectation".

For every $1 we bet, there are 2 possibilities:

1. The lucky case, where we double our money and end up with $2, and

2. The unlucky case, where we lose (3/4)'th to end up with just $0.25.

4/

Each of these outcomes is equally likely.

So, on *average*, every $1 we put in turns into ($2 + $0.25)/2 = $1.125.

This is a *positive* 12.5% return.

Such bets are called *positive expectation* bets. On average, we expect to *make* (rather than *lose*) money on them.

5/

Suppose we could take many turns betting at these odds.

In any one turn, we could of course lose money.

But because our bet has positive expectation, *over time* we expect to make money.

Circle of Competence 101

Warren Buffett and Charlie Munger often reference the importance of knowing the boundaries of your circle of competence.

But what is a Circle of Competence and how does it work?

Here's Circle of Competence 101!

1/ First, a few definitions.

A Circle of Competence is the set of topic areas that align with a person's expertise.

If the entire world of information were to be expressed in a circle, an individual's Circle of Competence is the small sub-circle that represents their expertise.

2/ The idea surfaced in the 1996 BH annual letter.

"You don’t have to be an expert on every company...you only have to be able to evaluate companies within your circle of competence. The size of that circle is not very important; knowing its boundaries, however, is vital."

3/ A Circle of Competence is built over time.

It is built through experience, reading, dedicated study, and effort.

It is dynamic, not static.

It can expand as you deepen your knowledge in new areas. It can contract if you fail to nurture your existing areas of expertise.

4/ To engage this mental model in your life, there are two key processes to go through:

(1) Identify what falls within your circle
(2) Identify the boundaries of your circle

(1) is all about figuring out what you know, while (2) is about humbly admitting what you don’t.

OK, I guess I have a thing to say about the stock market. I have done kind of what these Reddit folks are doing with it, in that I have invested in the stock market when I was not at all rich, using parts of my paycheck that it probably wasn't wise to risk. I don't now. (thread)

But, like, it worked out okay for me. I even shorted some stuff. I didn't coordinate with anyone or whatever, but I don't think on the individual level the stock market is *inherently* malicious. If you're privileged, you're going to be exposed to it (through 401ks, etc.)

And I don't think it's wrong for people to try to make money off of it outside of the 401k/retirement context that's socially normal, *especially* if they're desperate like I was. There *are* strategies that you can use that, while risky, aren't exactly like gambling

Like, gambling is risky in a different way. You are always working with a fairly consistent set of probabilities in gambling, and they're never in your favor (outside of grey area gambling like between friends, where you could hypothetically actually still card count)

Anyway, like, on shorts: I don't think they're evil. I think they're dangerous. For an individual, a short always carries a small risk of individual bankruptcy. There's USUALLY not even a huge upside to them; they're not mystical or magical, they're basically reverse "longs"

Overthinking - The art of creating problems which weren't even there.

Thread on How Over-analysis leads to decision Paralysis-

What is Analysis paralysis?

In simple terms, analysis paralysis is a person's tendency to over-analyze or over-think upon a decision to such an extent that he/she fails to make a choice resulting in a paralyzed state of inaction.

How a retail trader trades-

A trader named Rahul, He know all the basics of markets, He also has made a system which gives signals on nifty, he has also encorporated good Risk management and Position sizing into his system.

One day he gets a signal to buy Nifty at 13500 with stop at 13450, he wanted to take the trade, but he wanted to get sure that the trade he has take should be a winner.

So he says just let me check the RSI if its above this level I will buy , he checks it and it was above his

level, then again he wants to check another indicator named MACD, he wanted to get sure man, Now he do the most intelligent thing to get sure he gets right.

He goes to twitter and ask his twitter Friend Trader knight he ask him that should I buy nifty at 13500,

Thread on 'no stop loss', 'adjustments' and 'Risk'
----------------------------------------------------

Wanted to share my thoughts on this topic for a long time but this email sent by someone yday woke me up from slumber

Pls read the email 1st before delving into thread

(1/n)

In the past 1-2 years, there has been a sudden surge of traders who just talk about theta decay, option selling, adjustments and stuff like that..

It is all fair as long as the trader knows what he's doing. But the reality is far from what we see/perceive...

(2/n)

Many of these folks were told that one can 'adjust' their way out of any situation. Any sane options trader know that you cannot come out of any situation by adjustment

One of my friend used to do that(he is famous in options selling desi fintwit) for a long time until..

(3/n)

..he realized that one cannot possibly do that and its gonna burn him one day. He's pretty smart and hence, he put a portfolio level SL & when that hits, he will stop dancing, gets out and calls it a day

So, risk is managed at account level and he is quite clear about it

(4/n)

Unfortunately, 1000s of traders who does option selling(with adjustment) dont have this risk mgmt in place.

They think (i dont know if i had to call it false confidence or ignorance) their skills in 'adjusting' will take them ashore 😅

(5/n)