WM 1 September 2023

Quotes

Lessons & thoughts

Contingent vs Contingency

I-Ching

The rules of average

Success

Risk takers

Incentives

Express vs Impress

Terry Smith

Power of compounding

It is how they learn

How to analyse a balance sheet

Technical analysis is about timing (price vs time), supply & demand (price vs volume), trends (price vs price) and interaction of news and price (price vs information). 

Charlie Munger's key concepts

Simple and straightforward over complex and sophisticated

Use first principles thinking

   Apply a margin of safety

Think in terms of opportunity costs: ommissions vs commissions

Second order thinking

Avoid leverage

Think about incentives

Scarcity = pricing power

M&A flows as % of SPX gives a clue of supply and demand factors and qualititive and quantitative. It is a thematic catalyst par excellence as it denotes behavioural changes, it reveals macro trends, it indicates bottom up releveraging/deleveraging factors and has technical effects on the indices (supply and demand). So when you see a company buying another for a price, beware it is the tip of a much larger iceberg and that more deals should follow soon after. M&A tends to work as waves.

ChatGPT: improve your productivity?

Technicals = the Coppock curve

Macro news

Money

GDP

    

    

CPI

Asset allocation & yield curve

Geo-Socio-Politics

    

    

FX

Gold

Bitcoin

Fixed income

Real estate

    

Equities

The trend is your friend

Economics

Dashboard

Retail buyers

Congestion index

Earnings

Buybacks

Valuation

Seasonality

Volatility

Commodities

Alternative investments: HF, PE, VC, Private debt

Themes, Sectors & Corporate news

Cyclicals vs defensives

Healthcare

I used to run a thematic agri food portfolio. Two stocks which we owned in 2020 and did well then have seen a massive post Covid collapse. Hellofresh is looking interesting at these levels. The online food retailing theme is not as hot as it was during Covid obviously, but Hellofresh has some intrinsic competitive advantages in terms of gross margin that suggest capacity to gain share over time. Westrock is a pulp & paper company whose value case has not changed and will react well to a cyclical uptick

VC investments in IC trend

Cybersecurity

VR vs AR

Drones

Amazon vs Alibaba

    

Hypes chart