What are your Investment Rules?

[kiora]

"Fads, trends, and megatrends

Why megatrends are not a passing fad

https://www.goodreturns.co.nz/articl...or+31+Jul+2024

Fads
"Some clients may be attracted to fads, drawn like magnets towards ‘investments’ based on concept, promise and much hype.
Investing in them is speculative at best.
Fads are rarely based on sound fundamentals or pesky financial requirements like profitability."

Trends

" evolve over shortish time frames which makes them newsworthy.
trends are quite narrow and specific themes that possess sound reasons for their being. They usually attract quality enterprises that are investor-worthy, alongside many that won't be"

"Importantly, both timing and quality risks for fads and trends are high. Both require a degree of speculation"

Megatrends

"Where fads tend to be hype-driven and trends narrow in focus with shortish lives, megatrends are much bigger, longer lasting and game changing across whole swaths of industries and society
Megatrends are giant tidal waves of change – slow to form, far-reaching, inevitable, powerful and impossible to reverse. Ultimately, they flood everything in their path"

" Take the contactless payment megatrend. Unavoidable, unstoppable, and inevitable."

"Other megatrend examples include:

Workplace Automation
The Silver Economy
Pet Humanisation
Low Emissions
The Internet of Things (IOT)"

Rather than seeking out funds or ETFs that invest broadly in a megatrend sector, the focus should be on identifying a handful of standout companies. These companies excel in their management, financial health, and ability to capitalise on the megatrend.

Thorough analysis and disciplined selection are imperative, both in recognising the true potential of a megatrend and in choosing the right stocks within it. Even within a megatrend, identifying the winning companies is vital to achieving outsized gains"
"

[Snoopy]

Megatrends

" Take the contactless payment megatrend. Unavoidable, unstoppable, and inevitable."

Not inevitable. The only time I used my contactless payment card, I was taking another card out of my cardholder to pay the bill when the the payment machine sensed my contactless card and charged that instead. I was so annoyed I got out my fine scalpel and cut the receptor aerial in my contactless card so that the contactless function of my (VISA) card no longer works. In all other ways it functions normally though. I have no interest whatsoever in ever having a contactless card. It is far too big a security risk, and I will disable any contactless cards I am sent in the future with the same scalpel technique.

SNOOPY

[kiora]

"Megatrends are giant tidal waves of change – slow to form, far-reaching, inevitable, powerful and impossible to reverse. Ultimately, they flood everything in their path"

https://www.gminsights.com/megatrends/payments/32


Payments

Fueled by changing consumer preferences, increasing penetration of fintech into the traditional payments space, and smartphone-enabled real-time payments, the payments industry is witnessing a dynamic transition. Instantaneous transactions, messaging capabilities, and immediate fund transfers have ushered a new phase in the payments industry. Commercialization of the payments industry has been fortified by the introduction of contactless payment technologies, such as NFC and smart wearables, which became the preferred mode of transactions amid the COVID-19 pandemic. With growing technological innovations in payment methods, regulatory bodies need to match pace. Increased cooperation between payment regulators & payment solution providers will accelerate the digitalization of payments and infuse the much-needed impetus into establishing a unified payments platform. The need for robust regulations amid the ongoing volatility in the cryptocurrency industry has expanded the payments industry spectrum into digital currencies.

Drivers:
Changing customer behavior is fostering the payments industry growth. Digital disruptions and generational shifts are influencing customer behavior & expectations from payment solutions.
Governments are constantly supporting the adoption of digital payment technologies as a measure to reduce physical contact, track down financial transactions, and prevent tax fraud
Moving forward into 2023 and beyond, three major trends are expected to reshape the payments industry: embedded finance, cryptocurrencies, and Metaverse
The metaverse will blend multiple immersive technologies such as AR & VR into the payments ecosystem, allowing merchants to develop innovative payment methods
The gradual evolution of regulatory frameworks to integrate cryptocurrencies within mainstream financial services will broaden the product spectrum for payment industry players

[stoploss]

Not inevitable. The only time I used my contactless payment card, I was taking another card out of my cardholder to pay the bill when the the payment machine sensed my contactless card and charged that instead. I was so annoyed I got out my fine scalpel and cut the receptor aerial in my contactless card so that the contactless function of my (VISA) card no longer works. In all other ways it functions normally though. I have no interest whatsoever in ever having a contactless card. It is far too big a security risk, and I will disable any contactless cards I am sent in the future with the same scalpel technique.


SNOOPY

Snoops you can save yourself some time. Just go into your banking app-under card settings you can toggle off Contactless purchases.

[kiora]

"Be Slower To Sell Your Winners And Quicker To Sell Your Losers - Logan Kane"

"https://seekingalpha.com/article/4708709-be-slower-to-sell-your-winners-and-quicker-to-sell-your-losers-logan-kane?mailingid=36267827&messageid=must_reads&seria l=36267827.343389&source=email_must_reads&utm_camp aign=Must+Reads+-+Product+team+test+-+No+test+version+2024-08-01&utm_content=seeking_alpha&utm_medium=email&utm_ source=seeking_alpha&utm_term=must_reads

"IPOs are the best investment, pretty much that there is. "

"If you buy on the first day, the research shows after it opens that you will get a negative return."

" this article, it's 'can behavioral finance make you a better investor and improve your life?' "
https://seekingalpha.com/article/469...pArticle=false

"this isn't really obvious to a lot of investors, because they have a fatal attraction to the worst stocks in the market. Just the companies that lose the most money, they put out the most press releases, people can't get enough. But then you get stocks that are just small, profitable, and growing, and they grow, and people don't give them enough credit and they should."

"tailor your portfolio to avoid junk and to invest in quality"

"S&P 600 versus the broader Russell 2000, and you're looking at about 2% per year more in return over time. It's massive. It’s - over the last 25 years, it's just a massive return that compounds. And the only thing that's different with them, essentially, is that the S&P 600 doesn't allow junk and the Russell 2000 does allow the junk"

"Any company with an operating loss should immediately be a red flag when you're looking at it as an investment. Any share price below $10 is a red flag"
" So you don't want to be cannon fodder. Just stay out of the way of stocks like this. And it's honestly really helpful, and it's very basic, it's very underrated. But if you're able to do this, then your investment returns will be better over time."
"study of the Capitalism Distribution, but essentially, what it says is that the top 20% to 30% of stocks are responsible for all of the gains in the stock market. In the long run, about 40% of stocks have negative long-run returns,"

"the big winners, they stay big winners. So a lot of the companies that are big losers, they stay big losers. That's why we call this the Capitalism Distribution"

" you want to hold the stocks, actually, because they keep going up. The stocks that have gone down, and people hold them. You shouldn't do this"
Sell ,sell,sell:AT MARKET

"sell your worst investment to finance new purchases, and you should leave the ones that are winning alone."
"bear market. And the first school of thought is to buy blue chip stocks at discounts. Like if you can get Coke (KO) and Walmart (WMT) and Procter & Gamble (PG) and stuff like that for 30% off then you might do it"

"buy stocks on the cheap. Mutual fund managers, when they get redemptions, they have to sell"

[kiora]

"How to dominate small caps like Roger Federer dominates tennis

And why it's the points that you win that matter."

https://www.livewiremarkets.com/wire...0THE%20PODCAST

"the points that you win that matter. After all, Roger Federer played 1,526 singles matches throughout his career, and while he only won 54% of the individual points within those matches, he walked away with the win 80% of the time."

" "perfection is impossible". However, "when you lose every second point, on average, you learn not to dwell on every shot" and instead, "become a master at overcoming hard moments".

""I had a look at our performance, and actually, we had a similar mix of winners and losers, but I think the point is that it is the points you win that matter. You've always got to be looking forward. You've got to cut the losers and can't fall in love with stocks," he says.
"Stocks are just points. But it's the points that matter that win you the game. So for us, our largest detractor was still smaller than our 17th biggest winner. Even though we had an even spread of winners and losers, it was the ones that were successful that made it a good year."

"One stock to hold if the market were to close for the next 5 years
"Think long term,founder lead business,
Skin in game,steady culture,recuring revenue.

[kiora]

"The small and mid-cap biotechs poised for a big breakout"
https://www.livewiremarkets.com/wire...THE%20INSIGHTS

"Yet, while we are experiencing some of the greatest scientific innovation, prices have been driven lower over the past couple of years, not due to any change in the fundamental prospects in biotech innovation, but rather analysts revising up the discount rate used to value biotech companies (which pushes prices down). "

"We will not invest in any biotech with less than 12 months' cash runway and typically prefer longer. "

Counterintuative?

" piece of analysis that suggested that if you had a strategy of blindly buying biotech companies the day they released negative trial results, regardless of their indication or trial phase, you would have been handsomely ahead of market returns 12 months afterwards"

[Snoopy]

Snoops you can save yourself some time. Just go into your banking app-under card settings you can toggle off Contactless purchases.

Oh thanks I did not know that. Although in my case I can't do it, as I am still waiting for the bank to produce a symbian app for my phone. (My phone doesn't handle the new fangled Android and Apple apps). I presume doing this would only work in New Zealand though? If I went to London for example, I can't see how turning off my contactless purchases facility in New Zealand, would command the whole banking system in England to simultaneously to do the same?

SNOOPY

[Jay]

If you turn it off in the app then should make no difference where you are, when it tries to process the payment it will decline.

Have done a similar thing when overseas, as had a limit on the amount could spend in one transaction at a time, and forgot to turn that off or increase the amount and wondering why my card was declined - until I realized.
As was using a 2nd card overseas rather than the main where autopayments for Ins, rates etc come from as we know it is a pain to notify all these companies if you have to replace your card with a brand new "account"/ number if lost/stolen etc.

[kiora]

"Silver economy, older people will be the engine of the economy of the future"

https://www.iberdrola.com/innovation/silver-economy

"In the Europe of 2060, one in three inhabitants will be over 65. A similar trend of increasing life expectancy and reversal of the population pyramid will be followed by the rest of the developed countries on the planet. The forms of consumption will therefore change and older people will become the engine of the so-called silver economy.."

"They have high purchasing power and are free of economic burdens.
They use their time to do what they always wanted: to travel, enjoy new experiences, give themselves a treat, etc.
They are active people who like to take care of themselves, play sports, eat well, be fashionable and have fun.
They are loyal to their brands, consume more than young people and require more specific and personalised products and services.
They have more free time and like to take advantage of it with cultural and leisure activities."

"CHARACTERISTICS OF THE ECONOMY OF THE FUTURE
The silver economy still has many challenges to overcome today in order to become a true driver of the economy, but the economy of the future will be led by older people and will have the qualities listed below, among others:

Glocal

The economy is glocalising and in the coming decades it will be common for companies to think globally and act locally.

Inclusive

The economy of the future will have to correct the imbalances of globalisation in order to manage a just transition and distribute wealth more equitably.

Digital

The internet and new technologies will play a leading role in the Fourth Industrial Revolution and will be the centre of business innovation and the gateway to international markets.

Circular

Economic activities will seek ways to reduce the wastage of raw materials and resources such as food, water, technology and energy by boosting the circular economy.

Eco-friendly

With the creation of green jobs, the green economy will contribute to social equity, improve welfare and reduce resource scarcity and environmental risks.

Collaborative

The economy of the future will be more caring because it will encourage the exchange of products and services for shared benefit."

"Silverisation of sectors. New products and services will emerge on the market adapted to the needs of older people. To achieve this, it will be important to rely on gerontechnology, which is the area of technology that studies human ageing.
A boost to new professions. The ageing of the population will lead to the creation of jobs and the emergence of careers related to the silver economy, for example in the area of care for the elderly.
Investment in strategic plans. The rise of the senior economy will encourage governments to invest in solutions that improve health care and the independence of the elderly, for example."