Ex-Equity Analyst, now Private Investor: Nothing here is investment advice. Check out my blog for stocks I'm interested in: Aero/Def, Tech, Consumer, Industrial
Aug 29, 2022 • 8 tweets • 2 min read
I absolutely feel the same way and let me demonstrate it with a somewhat simplified example.
The Defense industry is a good example of where GAAP accounting (and therefore ROIC calculations) are misunderstood to a certain extent. If you look at a high level, defense contractors doing cost-plus work essentially have infinite ROIC, yet the accting wouldn't show you that
Sep 6, 2021 • 17 tweets • 3 min read
After reading/listening to a lot of investors describe their investment process, I want to share an anecdote⬇️
When I was on the sell-side, I had a client. We will call him John. John had all the right credentials and worked for a well known hedge fund when i met him. He was pretty well liked in the industry.
Aug 24, 2021 • 13 tweets • 3 min read
I've been thinking a lot about portfolio sizing. I've decided to eliminate arbitrary size limits in my portfolio, it doesn't make sense when you have new capital inflows every month and stock prices are moving around⬇️
Since i mostly invest in high moat companies with long duration cash flows, i think of my holdings as having broadly similar runways. This is especially true given my industry concentrations (over 50% of my capital invested in Aerospace and Defense, for example)
Apr 15, 2021 • 8 tweets • 2 min read
A thought experiment: Sometimes I wring my hands on stocks that I have "missed" that were "obvious" (see previous tweets on $GOOGL). So I thought I would test an extreme version of this bias to see how it fares...
Let's say you bought the 5 largest stocks by market cap each year since 1995. You equal weight them and you invest in them on Day 1 of that year. For my experiment I just assumed I buy $1000 worth of each of the top 5, or $5000 total every year.
