Tweet

Brian Stoffel

19 Oct, 11 tweets, 4 min read

@nntaleb

Nassim Taleb's @nntaleb work has adjusted my MINDSET to always consider his worldview.

My favorite book = ANTIFRAGILE

There are lots of heuristics I've developed from the book, but ONE stands out for its

✅Counter-intuitiveness
✅Real-World Applications

🧵⤵️

That is:

Given two choices, ALWAYS favor the one with:

😡Known Downside & Unknown Upside

OVER

😻Known Upside & Unknown Downside

The applicability in Life and Investing is under-appreciated...yet vast

And if you understand Anti-Fragility, it makes sense.

Something must have known (and acceptable) downside to stand the test of time. It must also *at least* have exposure to upside.

But no matter how great the upside is, if the downside leads to RUIN, it isn't worth it

One of the most fascinating LIFE examples:

Consider arranged (NOT forced) marriages.

😡If I were doing it, I'd definitely go into it focused on downside risks

😻Modern marriages often focus on upside dopamine hits from being in love.

How does that play out?

The divorce rate for "Love" marriages in the United States is between 40% and 50% (lots of confounding variables like multiple-marriages / divorces being outliers)

The divorce rate globally for "Arranged" marriages is 4%.

Not only that, affection GROWS over time

Or think about a person choosing:

😍The high-paying job because of the salary and prestige the position offers (known upside)

But neglects

😡The toll the job will take on mental and familial well-being. It leads to this ⤵️

My wife and I used this thinking when we quit our teaching jobs & moved to Costa Rica.

Worst-Case Scenario: Broke, Move Back with Parents, Slightly Jaded About World, Back to Teaching

Best-Case Scenario: who knows? We certainly didn't expect this ⤵️
medium.com/@stoffel.brian…

Importantly, this also applies to PERSONAL FINANCE:

✅Never choose to invest money you need in the next 3 yrs (assume you'll lose it --> Known downside)
✅Keep huge cash cushion
✅Invest what's left over w/ no expectations (unknown upside)

And investing...⤵️

My Antifragile framework is based on this

LIMITED DOWNSIDE
✔️Wide Moat
✔️Skin in the Game
✔️Lots of Cash, No Debt
✔️Skin in the Game
✔️No concentration risks

UNKNOWN UPSIDE
✅Mission-Driven
✅History of Optionality
✅Happy Employees

Want to see this in action?

⤵️

@BrianFeroldi

Simply subscribe to the YouTube channel @BrianFeroldi and I host. We offer:

✅3-5 videos every week
✅Examples of how to use this framework on individual stocks and (eventually) personal finance

And...

It's totally free.

youtube.com/brianferoldiyt…

@nntaleb

To review:

The most counter-intuitive heuristic I've gotten from @nntaleb's Antifragile is:

When given the choice between:

😡Known Downside & Unknown Upside

OVER

😻Known Upside & Unknown Downside

ALWAYS choose the first one.

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More from @Brian_Stoffel_

Brian Stoffel

@Brian_Stoffel_

12 Oct

In 2017, I made my first purchase of a company that is now my largest holding.

First ten shares cost ~$430.

Today, those same shares are worth ~$13,500

That's a 32X return in just four years!

Here's the stock, and three more I'm putting $$ into in search of similar results ⤵️

The company was Shopify.
$SHOP

I used my Antifragile Framework to double-check my conviction of the company.

The understanding of $SHOP from the framework even led me to buy more after a short-report a few months later

fool.com/investing/2017…

Using EXACT SAME framework, I've identified three more companies with similar potential.

The first is Axon Enterprise $AXON (already a 9-bagger for me)

Maker of TASERS, Axon body cameras & (most importantly) software solutions for police.

More on $AXON fool.com/investing/2021…

Read 9 tweets

Brian Stoffel

@Brian_Stoffel_

4 Oct

@themotleyfool

I started investing ~ 10 years ago.

👨‍🏫Rolled over my 403(b) from teaching
📈Started investing it.

Since then, I've averaged 25% returns per year.

A few things have helped:

* @themotleyfool
* A huge bull market
* A framework I devised to help

My portfolio as of 10/3/21 ⤵️

1) $SHOP, 15% of port, +2,300% combined returns
2) $MELI 9%, +1,000%
3) $CRWD 7%, +300%
4) $SE 7%, +130%
5) $MDB 7%, +500%
6) $AXON 6%, +500%
7) $TEAM 6%, +220%
8) $DDOG 5%, +300%
9) $AMZN 5%, +1,600%
10) $VEEV 4%, +750%
11) $GOOG/L 4%, +700%
12) $U 4%, +40%

Continued ⤵️

13) $ABNB 3%, +10%
14) $ISRG 3%, +800%
15) $PAYC 3%, +1,000%
16) $DOCU 3%, +15%
17) $ETSY 2%, +300%
18) $SNOW 2%, +10%
19) $ZEN 1%, +350%
20) $PTON 1%, (30%)
21) $GBTC 1%, +600%
22) $ZM 1%, +7%
23) $TSLA 1%, 30%
24) $RSKD 1% (40%)

The MOST IMPORTANT aspect of each one is ...⤵️

Read 9 tweets

Brian Stoffel

@Brian_Stoffel_

2 Sep

@themotleyfool

I started investing ~ 10 years ago. I've been able to achieve 26% returns *per year*

A few things have helped:

* @themotleyfool
* The combined teachings of @DavidGFool and @nntaleb (Antifragile)
* Sharing my holdings to be accountable.

My current port as of 9/1/21 ⤵️

(all Ex-cash)

1) $SHOP 17% of port, 2,600% return
2) $MELI 10%, 1,200%
3) $CRWD 7%, 350%
4) $SE 7%, 150%
5) $AXON 5%, 520%
6) $MDB 5%, 420%
7) $TEAM 5%, 200%
8) $VEEV 5%, 900%
9) $AMZN 5%, 1,700%
10) $DDOG 4%, 270%
11) $GOOG/L 4%, 750%
12) $U 3%, 40%
13) $ISRG 3%, 860%
con't

14) $DOCU 3%, 34%
15) $ABNB 3%, 0%
16) $PAYC 3%, 960%
17) $ETSY 2%, 340%
18) $SNOW 2%, 10%
19) $ZEN 2%, 385%
20) $PTON 1%, (16%)
21) $GBTC 1%, 600%
22) $ZM 1%, 16%
23) $TSLA 1%, 22%

Waiting (trading rules) to make some changes previously announced here.

Read 4 tweets

Brian Stoffel

@Brian_Stoffel_

28 Aug

In 2011, wife & I quit teaching, rolled over 403(b)’s.

Since then:

💰Never earned more $$ than 2010.
🏠Bought House
👩‍👩‍👧‍👦Started family

BUT, also since then...

Our roll-overs have 10-BAGGED

Surprising lessons on how we did it 🧵

1/ It wasn’t a straight line.

2012=9% returns
2013=28%
2014=(4%)
2015=(2%)
2016=0%

From 2011 to 2016 (FIVE YEARS), entire rollover was up only 30%

Annualized = 5%

S&P 500 during that time = 12% *per year*

@DavidGFool

2/ In 2016, two things changed.

@DavidGFool asked me to vote on a @themotleyfool service for stocks
I read @nntaleb’s ANTIFRAGILE

I needed a framework to intelligently vote for @DavidGFool’s service, and @nntaleb’s work provided that.

I started working on the framework

Read 18 tweets

Brian Stoffel

@Brian_Stoffel_

4 Aug

@nntaleb

Five years ago, after reading @nntaleb's *Antifragile*, I developed a framework for identifying Antifragile companies.

In the past three months, @BrianFeroldi and I have put 23 different companies through that framework.

Here's how they scored, a 🧵⤵️

A quick caveat:

Before 2020, 7 companies had been defined as "Antifragile". Since Jan 1, 2020:

* All 7 have beaten the S&P 500's 41% returns
* The average return is 150% (+109 points)

Why this matters: 2020 was the first "chaos" to measure anti-fragility at scale.

One more caveat:

* A low score doesn't = BAD INVESTMENT. There are tons of false negative.

I'm willing to accept that, because (historically)

* A high score has always = market-beating performance

Keep that in mind, as we go through the three levels.

Read 11 tweets

Brian Stoffel

@Brian_Stoffel_

25 Jun

The 9 Most Anti-Fragile Companies I've Evaluated

(That are still under $100 billion)

Largest to smallest, those 9 are:

1) Airbnb $ABNB - $94 B
2) Mercadolibre $MELI - $77 B
3) Atlassian $TEAM - $67 B
4) CrowdStrike $CRWD - $58 B
5) DocuSign $DOCU - $54 B
6) Peloton $PTON - $37 B
7) Datadog $DDOG - $33 B
8) Unity $U - $32 B
9) Axon $AXON - $11 B

Seven of these companies have been public since January 2020 -- capturing the chaos of the pandemic that "Antifragility" is built for.

Their average returns: 230%
The S&P 500's: 32%

What do all of these companies have in common?

8 things👇

Read 14 tweets

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