I think one of the most expensive lessons in investing is the over estimation of one's ability to dodge a DD & buy back a phenomenal compounder.
valuation is art, not science
Selling bc it was 30% or 6M expensive... If it is 10x/10Y does it matter? Insane value destruction.
Idea generation is really important, but if poorly executed it does not matter.
The willing acceptance to take a hit is part of the journey to the right tail. Skew is 20%pa, >1x 50%+ down @DecaDe for the 3% that make it!!
We had four >-65% DD L2Y. No apologies. Normal journey.
Most investors I know have a false sense of control (including me). Removing this delusion is really hard.
actively surrendering to the knowledge I have no idea when my stocks unleash has helped me a ton. If IV is CAGRg at 26%+ it will create a 10x/10Y. just don't know when..
high quality biz trade at optically expensive prices most of the ride.. that's empirical.
If buy cheap & sell when reasonable to be "disciplined" u hv no chance with high quality growth.
Don't be reckless w basis; but hv to embrace the discomfort of the ride. That's the price.
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Just finished this book on ALDI. Just LOVED it. Not the best written, but one of the few sources on one of the best businesses in the world bar none. Some things that struck me (there are many):
1) potency of simplicity - same concept executed for 70Y 2) scarcity breeds clarity
ALDI’s concept was born in 1948 bc the Albrechts didnt hv the resources to be a full SKU store
3) huge autonomy, decentralization and delegation. Virtually no central functions. They were a €30B co in 2011 that didn’t do central budgets..
- it is run as 100+ independent cos
They are run w minimal metrics - supreme clarity of what drives the business (cheap prices in a focused assortment). Never got distracted.
Wish there was more data on talent alignment and retention; their cashiers were the most productive in the industry and best paid. Like IKEA