Thread by @caprichinvest

Received requests on quant strategy tweeted earlier here’s a basic process I’ve modeled in the intrinsic value sheet, which removes emotions completely from decisions

Where each company is categorized based on its parameters and given range of value. I’ve hidden others companies

Once the ranges are in green we start to buy without second thoughts until I feel comfortable and as long as it’s available within that range. It’s a very disciplined process.

We keep updating the sheets as new information flows in and keep revising our estimates every 6 months

The idea is to be non- emotional and take decisions based on data.

Most of the companies have been in the green zone in March 2020 and not navigated to yellow or Red now. So that’s a time we start building cash.

This mod helps me to think through my own valuations and process

Success of my decisions using this model is 60 % but I’ve managed to keep the losses of 40 % low as to make a meaningful impact

This is a very subjective process based on industry analysis and your own estimates of value, once the modeling has been done it should be back tested

The idea behind this modeling has been developed from cloning Buffett and reading the book Trading in the zone which shows the importance of emotional discipline in decision making.

I have 15 companies in which only 2 are in green zone that I’m buying now

#caprichinvestments

I’m actively looking to model other processes for example a recent one I found interesting is Nick Sleep’s process mentioned in RWH book. The process looks prudent.

Also modeling process of businesses that are anti- fragile.

Disclaimer - The above is only for educational purposes not a recommendation. SEBI - Registered. Please do your own analysis before investing.