Med-tech is a great industry to get to know

Study these stocks to learn more:

$ABMD
$ALGN
$AMWL
$DXCM
$GDRX
$GH
$IRTC
$ISRG
$LGVW / $BFLY
$NARI
$NVCR
$NNOX
$OM
$ONEM
$PGNY
$PODD
$SDGR
$SILK
$SLP
$SMLR
$SWAV
$TDOC
$TNDM
$VEEV
$ZYXI

Podcast deep dives ⬇️⬇️⬇️⬇️⬇️⬇️⬇️

The 🔟 Most Important Money Lessons

I Wish I Could Teach My Younger Self 🧵

1⃣ ALWAYS live below your means

2⃣Developing a long-term mindset

is the foundation of financial success

3⃣In the beginning, your savings rate is all that matters

Eventually, your investing returns are all that matters

Focus your time accordingly

4⃣Financial freedom is achievable

The price is ~10 years of hardcore saving/investing

I asked, “What are the first metrics that you look at when evaluating a new stock?”

I received 322 replies

Here are 10 great metrics to look at first (and how to find them):

1/ Market Capitalization

Why: Shows the current size/scale of the business

Where: @YahooFinance (image), @theTIKR , @KoyfinCharts ...etc

2/ Sales Growth Rate

Why: Shows the business model works & current growth rate

Where: @stockcardhq (image), SEC filings, @theTIKR...etc

3/ Free Cash Flow

Why: Is business generating cash or burning cash?

Where: @YahooFinance (image), SEC Filings, @stockrow1...etc

4/ Returns on capital (ROE, ROIC, ROA)

Why: Shows capital efficiency of business

Where: @stockrow1 (image) , @ycharts , @YahooFinance...etc

My investing style: Buy and hold high-quality businesses

Here are 15 traits that tell me I've found a great business ⬇️

1/ Recurring Revenue

Types:

Business Services $MCO
Contracts $AMT
Consumables $MNST
Exchange $MKTX
Franchise $WINA
Membership $TDOC
Platform $ETSY
Razor/blade $DXCM
Real Estate $STOR
SaaS, PaaS, IaaS $TWLO, $NOW, $FSLY
Subscription $NFLX
Tollbooth $BIP

2/ Recession-Proof Demand

Great companies sell products/services that are in-demand in good times and bad

That allows them to grow regardless of what is happening in the broader economy

3/ Organic Growth

"Organic" growth: Growing by increasing sales of internally developed products/services

"Inorganic" growth: Growing from mergers & acquisitions

Organic Growth > Inorganic Growth

4/ High & Expanding Gross Margin

Indicates that the company’s products/services create a huge amount of value for the customer

Rising gross margin also indicates pricing power

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

Over 51,000,000 YouTube channels exist.

99.8% of them are a waste of time.

Here are 10 channels that are GUARANTEED to entertain you AND make you smarter🧠:

1/ @theatlaspro

I had no idea that geography, geology, biology, and ecology could be so

2/ @TheCrashCourse

10 minutes lessons on any almost subject that you can think

3/ @MarkRober

Former NASA engineer teaches science lessons through videos that will entertain the whole

4/ @thephysicsgirl

Short videos that explain physics in a fun and easy-to-understand

A THREAD:

7 FREE OPTION TRADING COURSES FOR BEGINNERS.

Been getting lot of dm's from people telling me they want to learn option trading and need some recommendations.

Here I'm listing the resources every beginner should go through to shorten their learning curve.

(1/10)

1st Course - TASTYTRADE

This channel on YouTube is a goldmine for people wanting to learn about options both basics and advanced. By far the best and the most popular channel out there amongst option traders.

2nd Course - OPTION ALPHA

This channel is also pretty well known amongst option traders and they have laid out the path to generate consistent income trading options.

3rd Course - PROJECT OPTION

Lengthy videos explaining the benefit of trading options and has gone through

4th Course - TASTYTRADE

Another crash course on options by tastytrade. Different strategies have been compared while some focus on trade management is also

(Thread) Why do I own individual stocks?

Thesis:

1. The digitalization of our world is 10% complete.
2. This megatrend will continue for at least another decade.
3. If you enjoy spending your free time on individual stocks, then the potential for outsized returns is possible.

What is my approach?

There are two parts to my portfolio.

- 40% in Vanguard All-World ETF. This is on autopilot w/ regular contributions.
- 60% in what I consider to be high growth stocks

I keep a balance by adding cash. No shuffling around unless it gets too out of whack.

The latter is the interesting part.

I invest in companies that can

1. successfully disrupt an industry with new business models $TTD $SQ $PTON $TDOC

2. further enable the digital transformation with their services and infrastructure $ZS $HUBS $TWLO $CRWD

I intend to hold my shares indefinitely and allow my investments to compound over time.

I don’t believe that it is possible to time the market. Markets go up and down. I hold on knowing that quality businesses tend to bounce back.

The list of reasons to sell is always long.

If you have full conviction in your holdings, then no single piece of “infotainment” should make you change your mind.

Ignore it + people who make predictions about the economy.

FEAR - It’s the re-experience of failure in advance.

Many traders face the issue of Not entering in trades because of fear.

A thread on How to pull the trigger when the opportunity knocks.

Lets First start from knowing the cause of this "FEAR" of pulling the trigger.

A traders goes through many phases before becoming Profitable.

The first phase is the " APUN HI BHAGWAN HAI" phase-

When we first begin Trading, we don’t know any concepts, we don’t know about the risks , the dangers.

So we start trading, and like most guys by beginners luck we start making good, we start to calculate how much money we will make in next 1yr, 5 yrs, Greed start to Hop in.

We get introduced to Various instruments, F&O, LEVERAGE.

We take big positions as we don’t have any FEAR cause we haven't seen those bad phases yet.

Now we get the Big blow, account down -50%, or in many cases wiped out.

The first phase ends here.

Now we know How the market can kick our ass, we now know the risk that comes with those big positions.

"THE LEARNING PHASE"-

Now we know that we were just lucky initially and now we have to learn why we get those losses, so we start learning concepts , fundamental, Technicals.

Many traders have no consistency when sizing their positions.

The pros have this down to a science.

Here's my dead simple, 3-step guide to position sizing (and to outperforming 99% of other traders in the process):

Step 1:

Define how much of your account you're willing to risk per trade.

Personally, I never risk more than 1% of my account equity.

If I have $100,000 account, I will never risk more $1,000.

This ensures I will never blow up my account on one single trade.

There are successful traders who risk 2-3% of their account per trade, but I find it most calming to risk 1% or less.

The first step in this process is completely up to you - only you can dictate how much risk you can tolerate.

Step 2:

Look for entries & exits that are within 5% (preferably less) of each other.

This means if I buy a stock & have a 5% stop loss, I can put a 20% equity position on & still be risking 1% of my equity.

Your account will thank you w/ 20% in a stock that goes up 100%.

Step 3:

Position size using this formula:

Total equity (100%) / Trade Stop Loss %

So, if your stop loss is 4%, here's the math:

100% equity / 4% stop loss = 25% Equity Position Size

(assuming 1% equity risk).

Here's another hypothetical calculation:

If I stuck to this one rule the day I started trading I would have...

• Saved $1,000's of dollars in losses.
• Sped up my learning process.
• Avoided every major account drawdown I've had.

If you're new to trading, make sure you stick to this 👇🏼

The 1% Rule 🧵

The 1% Rule states that you should risk, at most, 1% of your total account on every individual trade.

This 1% risk is a function of two flexible components:

• Your Position Size: % of your account in the trade
• Your Trade Risk: % between your entry price and your stop loss

Want to take a larger position size? Make your stop tighter.

Trading a volatile stock? Size down on the trade.

The most important aspect of trading is risk management.

It's great to make money, but worthless if you don't have a system to keep it.

Over 50% of my trades are losses, but I'm still profitable because of the 1% Rule.

Keep losses small & let winners run!

"Nick, 1% risk isn't enough, my account is small."

New traders are EXACTLY who benefits the most!

By limiting each trade's potential losses to 1% it will take you:

• 29 straight losses to fall 25%
• 69 straight losses to fall 50%

It's tough to be that consistently bad 😅