Vish_ram

I own and like MUSA, the greatest cannibal

I wrote this a few years ago. I've a better understanding now. My thoughts on cryptocurrencies.pdf

Let me elaborate Macro: the attached pic outlines the overall approach. We use indicators like temp help, U6, job openings and several others. Compounders selection: based on several factors 1) buybacks - we run screens to find out companies that buyback at least 2%/annum and drill down more to find best ones 2) we use koyfin for checking trends in margin, profitability, multiples (on P/S, EV/EBITDA, P/E etc), trends in FCF/sh 3) company should be an industry leader (1 or 2) 4) Long term record of good M&A, buy back 5) Management incentivized and aligned 6) Always trim if overvalued and back up the truck when cheap 7) Constantly evaluate current positions with those in watchlist 8.) Maniacal focus on CFO, capex, FCF and trend 9) Ignore turnarounds, hopium stocks 10) only focus on stocks that have durable competitive advantage, pricing power 11) Avoid all commodities 99% of the time 12) Avoid leverage, penny/microcap/99% of small caps 13) Avoid foreign stocks Last 5 years the annualized returns for clients were 20% after fees Vs 12.x for S&P 500. The use of macro significantly improved the performance.

Use macro for strategic cash allocation and invest in long term compounders that will outperform S&P (positive rev growth, high ROIC, FCF, prudent buyback/M&A).

Climbing Kilimanjaro this March

Subject close to my heart. (disclaimer: I'm a RIA and my firm's objective is to outperform S&P 500 and have done it as well). Over time I've realized the beauty of cap weighted indices. 1) The index (SPY in context) just rebalances more often than a typical fund manager 2) The index doesn't bring in the emotions, biases, valuations into account. Fund managers do 3) Index is quick to embrace new companies, concepts, ideas. if world moves towards a paradigm where tech companies rule the world, index automatically readjusts itself. The idiot fund mgr are stuck in the old paradigm. 4) Index doesn't worry about macro, cash position etc. It is fully invested all the time 5) Index reflects truth, the economy, sum total of people's preferences & actions, reflects the effect of macro/micro policies, reflects total effect of collective R&D, policies of govt etc. Most folks can't price them all in fast enough in the long run 6) Index is the most efficient in kicking out losers, reducing exposure to future losers and relentlessly adding to winners. Fund managers fail to do this big time. The only soundest advice I can get behind is what Buffett gave to his wife. All rest is garbage to a varying degree. “Put 90% in S&P 500 and rest in US treasury”.

Things will change when we have a credit default event or hyperinflation due to debt crisis.

Munger taught us how to invest, how to think about investing, how to live a happy life, how to handle success & failure, understand human psychology... What more one can ask for?

Kudos to Pabrai for launching this fund. But the ugly truth 1) Triple digit cumulative underperformance over S&P 500 in last 20 years 2) Shamelessly creating a presentation that shows Buffett & his success for several pages and hinting that it applies to his fund

Medical devices industry is a bit unloved

It is sad to see Canada turn to aid and abet terrorism in India. The chickens always come home to roost.

MUSA is a great compounder and does buyback.

If one day China transitions to Democracy, it'll be messy & disruptive to world trade. India has got this wonderful opportunity to capitalize on Xi's paranoia. Now it is finally India's turn to ride the prosperity wagon.

I did the 12 mile hike to see the new volcano Litli Hrutur. Just amazing. IMG_1525.MOV

I highly recommend Iceland. My son & I finished Laugavegur trail and did the ring road in a camper van. The trail was easy and amazing.

It is crazy that the cold war has continued for 78 years now. This is a multi-generational deep seated mistrust. Will this ever get resolved? The Russians should be the most cursed people on Earth. They suffered during Lenin (during birth of Communism), Stalin (worst human loss during WW2) and now Putin.

koyfin finviz morningstar

VTI VIG VYM (decreasing order of volatility & return). when you start off, put most of $ on first one, then slowly add/trim to 2nd & 3rd. Then live off the dividends that these generate.

@nwoodmancongratulations on your EBC adventure. I had planned a similar thing, a climb to Lobuche and EBC. I could finish the EBC and then settled in Lobuche base camp. The weather turned so nasty that we had to scrap it. My only great memory of that was the pic I took of the Lobuche base camp. Ama Dablam is in the backdrop

Doing Laugavegur trail in Iceland this july with my son

So true. My partners and I are RIA's and have some active portfolios. Even though we've outperformed S&P 500 after fees since inception 9 years ago (lumpy though), most don't care. They look at portfolio of $x and want that to not drop. Even if we give consistent 7% they'll be very happy. 99% of investors aren't sophisticated and view the equity markets as a casino. Invariably they refer clients and add $ only in rising markets.

Haute Route (10 days, ~120 miles) was an amazing hike. Some also like the Tour Du Mont Blanc

The real trip & the most profound is tripping on Ayahuasca in Iquitos Peru!!

If you like hiking mountains, then Patagonia (Chile) is just amazing.

BTC uses: store of value - > this is already established as a digital gold. But the rub is, price needs to keep going up to sustain the momentum. That means more people have to keep joining the network. If price drops with continued downward momentum, the leveraged bets will wind up with big losses, resulting in more liquidations and exits. To an extent this is a ponzi/pyramid scheme (like Herbalife, Madoff). The current cycle of (price manipulations->pump & dump->leverage-> more price jumps with more people joining the fray-> dump-> run on the exchange-> collapse) will eventually result in more regulations and reduced speculations. if price is constant, then it removes all speculative activity/leverage. The alternative assets that go up will become attractive and slowly with increased BTC supply, the price will trend down. To compound to this problem, we've millions of new crypto coming out. The 2nd use of BTC as a currency (facilitating exchange of goods) hasn't taken off. It can't handle the volume or hasn't gained traction. Crypto has a ecosystem challenge. It can’t penetrate fiat ecosystem in a meaningful way as existing infrastructure handle fiat well and at scale. You need a complete alternate ecosystem for crypto to potentially thrive. What can that be? Assume we spend most of our lives in VR, we work, live and get entertained there. We can do 1000s of micropayments/even big $$$ (your avatar gets a spa, learn a new language in VR, your physician performs virtual examination going thru your MRI in VR, invest in virtual real estate etc). We are not there yet. let's compare this to internet. Internet used almost all of existing infrastructure (computers that were already used for word processing, computations, payment processing, transportation to get stuff shipped, existing media content creators, etc etc. In each case, it complemented or augmented existing processes. Crypto is trying to replace fiat, create alternative payment system and thereby threatening existing status quo of taxation, governance and regulations.