Thread:

"When is Alt Season?" is a question we all ask a lot so let's take a look at a possible scenario that could answer that question.

Like humans , stocks too have different nature and if you are trading every stock the same way then this thread may be for you.

A thread on Nature of stocks and how it can help you to improve your trading results.

First start with what is the nature of stocks ?

I broadly categorize stocks in two categories-

1. The momentum stocks-

These are the stocks where most of the moves are swift in nature, or we can say that the pullbacks in a trend are smaller.

2. The AKBC stocks-

These are the stocks where most of the trending moves comes with deep pullbacks.

Examples-

So the purpose of categorizing these stocks, is that we Trade those stocks/instruments which are more suited to our style.

Say if you are a mean reversion player and you are trading in the momentum stocks category then you are more bound to lose over large number of trades.

While watching the GameStop stuff has been mildly hilarious (I mean who doesn't like watching the financial elite squirm?) it's pretty clear that a whole bunch of folk have convinced themselves this is ACTUALLY some kind of revolutionary activity. It isn't. 1/

Sure, it's highlighted yet another way in which the bastards profiteer but that's about it, stick it on the pile with the fifty other pro tips to keep the poor, well poor... It's todays banter and tho a few folks might have egg on their faces, literally nothing will happen. 2/

GameStop's three largest shareholders have earned £1.5bn+ during this. They sit at the top of some 200 institutions which are rolling. Meanwhile the ersatz rebels are now watching the bubble, realising there is profit to be made and having a wibble. 3/

No doubt some TRULY believe they are taking part in some kind of revolution but frankly it's utterly absurd and the vast majority are in it for the lulz and to cash in quick.

I'm sorry to tell you this, but you don't own GameStop.

4/

The reality is, the scale of the economic disparity and corruption is simply vast. Billionaires loosing a few millions means nothing. They buy one less yacht and you continue to live meal to meal.

The "Free Market" changes a few systems and the abuse continues. 5/

30 books I wish I read before Investing my hard-earned money:

1. You can be a Stock Market Genius by Joel Greenblatt
2. Common Stocks, Uncommon Profits by Phil Fisher
3. Margin of Safety by Seth Klarman
4. The Crowd by Gustave Le Bon
5. Winning the Loser's Game by Charles Ellis

6. The Zurich Axioms by Max Gunther
7. The Most Important Thing by Howard Marks
8. Thinking, Fast and Slow by Daniel Kahneman
9. The Intelligent Investor by B. Graham
10. A Zebra in Lion country by Ralph Wanger and Everett Mattlin
11. Learn to Earn by Peter Lynch

12.Poor Charlie's Almanack - The wit and wisdom of Charles T Munger
13.Speculative Contagion by Frank Martin
14. The Long and the Short of it by John Kay
15. More than you know by Michael Maubossin
16. Influence - The Psychology of Persuasion by Robert Cialdini

17. The Psychology of Judgment and Decision making by Scott Plous
18. The Real Warren Buffett by James O'Loughlin
19. Devil take the Hindmost by Edward Chancellor
20. Risk Intelligence by Dylan Evans
21. The Emotionally Intelligent Investor by Ravee Mehta

22.Accounting for Value by Stephen Penman
23. Common Stocks and Common Sense by Edgar Wachenheim III
24. Big Money Thinks Small by Joel Tillinghast
25. Memos from the Chairman by Alan C Greenberg

Knowledge sharing initiative Book 3: "Zurich Axioms" by Max Gunther

The book crystallizes how to think about taking investment bets (position sizing), and how to reduce risks in investing & speculation. It focuses on teaching a balance between rewards & risks.

(1/n)

Here are the key takeaways from the book:

1. Take sizeable bets in life: Taking small bets will give you a good night's sleep as you have very little to lose, but the important point is "it won't ever make you rich".

(2/n)

2. Taking size-able risk is necessary to get rich but make sure you don't go bankrupt taking that risk.

3. Don't diversify too much as gains & losses will nullify each other.

(3/n)

4. Be less greedy to make money - Book some profits when you see a sudden huge increase in wealth - fear of regret will stop you from booking profits but don't be greedy as consistent streaks of lucks are rare in life.

(4/n)

5. Cut losses when you go wrong don't start praying that your losses will recover rather act quickly take some loss and sell out.

(5/n)