Don’t try to hit homeruns in hype and hope stocks; focus more on avoiding losers than finding ‘ten-baggers’ for your investment portfolio. The upside takes care of itself through economic growth and value creation, as long as you avoid common, simple, stupid mistakes

The ancient wisdom of saving for a rainy day

Keep some dry powder ready for buying good stocks on sudden price falls. There are times to go to zero cash or even use leverage, but most of the time you should keep cash at hand to be able to participate in sudden extraordinary opportunities

Rebalance your portfolio regularly, albeit not too often (avoid day trading your value-based investments)

Try to come up with a workable stop-loss strategy (or stop-profit). Knowing when to sell is the most difficult thing in investing

Design, maintain and optimize your investment portfolio

• Designing a portfolio entails ranking one’s best investment alternatives, and buying most of the stocks with the best risk adjusted potential.
• Maintain your portfolio by researching and comparing new potential holdings, and updating your list of potential new investments. Add the highest ranking one (and eventually sell the lowest ranking one on a good day)
• Optimize by trading unwarrantedly outperforming stocks for more of your (hopefully temporarily) underperforming assets. This dynamic, whether based on performance or regular time intervals, leads to the accumulation of additional units (number of shares) of each asset in the portfolio over time. It’s called a “volatility dividend”, since the price swings are utilized to garner a higher total return.

Otto inspo

• Week 1: Valuation
• Week 2: Finding & Collecting Stocks
• Week 3: Business Analysis & Forecasting
• Week 4: Timing Your Investment
• Week 6: Case Studies