The framework appears super simple: buy 2-3+ star investments, scaling in as they improve, and sell 1-3 star exit opportunities, with risk amounts you can mentally manage—never going all-in. In essence, it's about buying low and selling high while maintaining solid bankroll management. If you think about it, this framework mirrors how successful VCs work; they get in early during seed rounds, Series A/B, etc., hold for years, and exit during an IPO, which can often serve as a contrarian indicator. Venture capital is, in a sense, a forced good investing approach, making investors to adhere to a solid framework. The missteps some VCs make often come from repeatedly investing in the wrong opportunities—essentially, death by a thousand cuts. The core structure of their method is sound; they just need better access to superior opportunities, which is largely a networking and branding game. I’m essentially trying to replicate that framework in liquid markets—a "liquid VC" strategy. However, VCs enjoy a great advantage: they are FORCED to follow that framework. Even if they wanted to sell, they couldn’t. Look at the stories of those who sold Bitcoin, TSLA, AMZN, or GOOGL too early; I would wager many top VCs wouldn’t be where they are if they had had the option to liquidate their shares at any time during their investments. As I mentioned earlier, it all boils down to psychology. The investor who bought TSLA at $5 and sold at $12 thought they were being rational, but in reality, they were likely just following the herd—responding to any bearish opinion they encountered or sabotaging their potential for larger profits because they didn't see themselves as the type to make massive gains. Distinguishing between taking a profit and self-sabotage can be extremely difficult in real-time. Thus, a crucial aspect of this framework is discipline. It's about having the patience to hold onto those 2-3+ star investments for as long as necessary while waiting for a genuine quality exit(like the VC waits for the IPO). This involves gauging how high something needs to rise before it makes sense to start exiting, sensing sentiment, reading contrarian indicators, and judging the valuation of hard-to-value assets. This is where the art lies. It wouldn’t matter if everyone knew this strategy; it could be put in a best-selling book about it, but at the end of the day, it boils down to psychology and the art of market analysis. Experience, intuition, hard work, study, backtesting—all these factors matter, along with knowing yourself, maintaining good self-esteem, independent thinking, intellectual humility, and a growth mindset. So while the framework is straightforward (buy low, sell high with solid bankroll management), the application is incredibly difficult. Writing down this framework helps me become more aware of it and holds me accountable. I’ve always did great in the analytical aspect, but I’ve struggled to stick to it due to emotional influences. However, this is an area where I’ve made significant progress over the past year and now I feel ready to reach the levels of discipline, independent decision making and boldness I didnt had before, now I feel ready to reach the next level in my trading ability
The strategy is simple enough that some people might even try to do it instinctively. Some will have sharper analysis, but where 99% of people—myself included—completely mess up is when emotions get in the way, often without realizing it. No one is immune to this. FOMO Fear of missing out is a sure-fire way to burn through capital. FOMO buying means throwing discipline out the window and jumping on whatever's hot because you can't handle the pain of waiting. That’s a massive mistake. The more you feed this impulse, the more it controls you. You’re more likely to lose money, and that sets you up for more emotional errors later. Instead of waiting for solid 2-5 star entries, you start taking -1, -2, or -3 star ones—when you should actually be thinking about exiting or scaling out if you had a long. FOMO feels good, which is why people keep doing it. Now that I’m formalizing my strategy, I’ll have a clear filter: before I buy, I’ll ask myself, "How would I rate this entry?" If it’s not at least a 2-star, I’m passing. Staying disciplined with entries is a big key because it avoids the capital burn and emotional tilt of bad decisions and saves your capital for real opportunities Fear During the 2008/09 crisis, buying stocks was brutal. It was much easier to think the world was on the brink of a depression. I’ll never forget David Rosenberg saying the S&P 500 would stay in a range 400-600 points, plus all the so-called experts (even Soros) calling the 2009 rally a bear market rally (same thing happen in the Covid rally with El-Erian). Fear spreads fast, and it's hard to go against it. No one is exempt. But when your analysis tells you otherwise, you need the guts to act. The best entries, the 3+ star ones, will require going against the crowd. If you express that opinion, expect to get shredded—verbally at least. But that’s often a sign that your edge in the entry is real and large. Discipline to Sit Tight for Exits Top venture capitalists wouldn’t have their reputation if their investments had liquid markets. Peter Thiel, for instance, is brilliant as a VC but not as a trader. Look at his hedge fund, Clarium Capital, the performance was dismal, and how he sold a chunk of Facebook right at its IPO, missing out a big profit. The VC model forces you to hold your position, sometimes for years. If you're dealing with liquid markets, though, you’ll need a whole new level of discipline to wait for the right exit—high valuations, contrarian signals, negative catalysts. You’ll need intellectual humility and a clear mind, so you don’t find excuses to exit early. In some cases, tech can help. For example, you can lock Bitcoin or other crypto on the blockchain until a certain date—mimicking VC-style forced holding. With stocks, it’s trickier, but setting up a separate long-term account and avoiding logging into it might help. Bottom line: waiting for the right exit is crucial, and it takes monster-level discipline. Self-Sabotage This is a big one. I’d say more than 95% of people who self-sabotage don’t even realize they’re doing it. There’s no flashing sign in the sky saying, “Hey, you’re screwing yourself by selling XYZ right now.” It happens below the surface, and that’s why it keeps happening. People are often too proud to admit it. Whether it’s selling too early because they think profits are scarce, buying too soon, or freezing up from fear, self-sabotage comes in many forms. Another form of self-sabotage is not being open to new things. Take Warren Buffett—he resisted tech for ages before finally buying Apple around 2013/2014. Even now, a lot of financial types are still skeptical about crypto. Two examples that come to mind where most people are resistant but maybe shouldn't be: memecoins and NFTs. Until you sit down, really analyze this stuff, talk to people who are deep in it, listen to both the bull and bear cases, you shouldn't be too quick to judge. That kind of knee-jerk reaction is a sneaky form of self-sabotage. It seems rational, like saying, “NFTs are just a scam, right?” but it’s really jumping to conclusions with maybe 1% of the information. A person can live their whole life like this—always late to emerging trends because they keep thinking “this is a bubble” or “that’s a scam.” They never catch a big trend early because they shut down before they even fully understand it. That’s self-sabotage, plain and simple.
Evolution through generations Another common pitfall is idolizing a role model or guru, failing to notice how disconnected they might be from current trends, or simply not keeping pace with the evolution of investing and trading. Gary Kasparov, the chess legend, summed it up perfectly: “The younger generation knows more than the older generation. They have access to an accumulated wealth of chess knowledge that I did not have.” “Today’s players stand on the shoulders of giants. Each generation builds on the knowledge of the previous one, and as a result, chess evolves.” Yet, you still see people hanging on every word Buffett says or, worse, trying to replicate his outdated strategies in a market that's changed dramatically. Since 2000, Buffett's performance has been trash. If we were talking chess, he’d be Bobby Fischer in his later years—once great, but long out of touch with the modern game, and no match for today’s best. Instead of clinging to yesterday’s legends, we should be paying attention to the next Buffetts. In tech and VC, I’d look at people like Thiel, Andreessen, and maybe some from Sequoia. I’d rather listen to them than a past-his-prime Buffett or some tone-deaf thing Munger said. They’re too old, too rich, and honestly, they’ve got other priorities now. When you have a few years left in your life, you are not going to spend trying to keep up with the lastest tech trends. Thats why Buffett missed tech for so long, he is past his prime, some people resist that so much, its like trying to get someone out of a cult, its almost impossible, its like they are looking for a father figure and they found it, and they aint gonna let daddys hand go. That is self sabotage. And it's not just Buffett. Most of the greats—Soros, Druckenmiller, Tudor Jones, Dalio—are past their prime, out of sync with the new generation. Listening to them talk about today's trends is embarassing, is like asking your dad about AI—just pure ignorance. I want to hear what people younger than me have to say. The next crypto Buffett is probably 15 years old right now, and if you're still stuck listening to dinosaurs, good luck. Someone once said, half-sarcastically but wisely, “My financial advisor is 13 and on TikTok.” There’s more truth there than meets the eye. Ego Ego is another sneaky way to sabotage yourself. The tricky part is, as your ego grows, almost no one thinks, “Hmm, my ego is getting too big; time to dial it back.” No, it just keeps going. And the last thing the ego wants to admit is that it has a problem. Often, there's deeper stuff going on—like trauma—driving these egoic tendencies, which can lead to bad decisions: FOMO buys, premature sells, over-risking, overtrading. One thing I love about more active trading (day or swing trading) is that you get a lot of reps. You’re wrong often, which humbles you and keeps that ego in check. When you’re only making 2-3 trades a year, the ego has way more room to grow unchecked. But if you build solid mental habits, staying aware of egoic thoughts, you can manage it. The reality is, most people don’t. Success can also inflate the ego, leading to eventual failure. I feel like whats what Ackman is going through right now, getting involved in politics, universities, acting like a savior of the world, now he did formalize his strategy/rules a few years ago after the VRX debacle, time will tell if thats enough to keep him out of trouble but I feel like he already is in one, with so much time spent on political stuff, where does he gets the time to evolve personally and keep up with the current trends? I doubt he does, so thats a sneaky way the ego comes in and mess someone up. He also admires Buffett so much, he inherhited a lot of his limitations and blind spots, only recently he started to get more involved in tech and seems to be beginning to understand crypto If you’re only trading or investing to feed your ego, it’s going to blow up at some point. Deviations from strategy follow, and depending on how big those mistakes are, the consequences can be massive. Ego is a huge topic. Someone could write a whole book on it, and it's something you’re always learning about. There are always egoic thoughts you have to deal with—it's human nature. You can’t “win” this battle. If you think you’ve beaten it, that’s when the ego has already taken over again, blinding you to your flaws. Controlling ego is a lifelong discipline, keeping it in check, staying humble. As the Bible says, “When pride comes, then comes disgrace, but with humility comes wisdom.”
I just sold 33% of my gold for a few reasons: Gold investors are out here bragging and tossing around huge price targets. Feels like a solid contrarian signal to me. The Economist, which is usually a good contrarian indicator, just dropped three articles on gold in their latest issue. They rarely write that much about it, so that really caught my attention. Like the price rise and all the talk made journalists interested, feels like a short-term peak I think the Fed could flip back to being hawkish after the election, especially if their candidate (Harris) loses. Gold’s had a strong run this year, and with rising rates, it feels like the right time to take some profits. Long-term, I still think it's solid with China, Russia, and others needing to buy it. But tactically, this seems like a good moment to rebalance and pull some out.
I see some juice left in the trade short term - maybe another $100-$200? Medium term is anyone’s guess but the fundamentals look rock-solid. Along the lines of the series of posts you wrote earlier on your methodology… I’d say this illustrates the conflicts inherent in “macro” trading. It’s very tempting to be constantly buying and selling based on factors like sentiment or your gut feel of short-term turning points, but at the end of the day, unless you are following an actual proven methodology for predicting short-term direction it seems like you’ll just introduce randomness. Instead of framing your market activity as “trades” with entries, exits, and per-trade PnL, a better approach might be to think in terms of a holistic portfolio stance which you review on a fixed schedule; say every quarter or even every six months. This would have several benefits: 1) Macro themes take quarters and years to play out, so if “global macro” is an accurate descriptor for your approach then there isn’t any value (and indeed, likely negative value) in faster portfolio turnover. 2) The noise will wash out and leave you capturing only the “signal” of your macro calls. 3) The portfolio itself will suggest opportunities to trim winners or add to valid themes which have become cheaper, since your % allocations will get out of whack. 4) A portfolio approach encourages long-term, open-ended thinking and discourages practices like sitting in cash when you don’t have any really great ideas - instead you’d sort of naturally revert to a default portfolio stance based on your overall life situation and risk tolerance. Anyway, those are my two cents.
i see, this used to be my approach. however, it can lead to many problems, and since my timing skill has improved over the years, my current approach has more advantages. imagine waiting for the quarter to end when silver was in a bubble in the 80s, or there is a large contrarian signal on BTC. or not buying the Covid panic sell-off because its not the right day yet. Portfolios have to be rebalanced, and with timing skill, real-time rebalancing will lead to extra returns vs fixed date based rebalancing. And sitting on cash I find it fine, my approach is based on the barbell idea, a mix of safe assets (cash, bonds, gold) and risk assets (stocks, crypto, memecoins, NFTs). Increading cash is necessary as it will provide me with dry power to buy the very volatile risky assets that tend to be very bipolar, and you cant never tell for sure when they will switch moods. so cash is an insurance against unexpected mood changes in risk markets (some might call this optionality)
Trump didnt win because he is a misogynist, racist, a failed businessman that has no empathy towards people that wants to become a dictator and somehow people decided that they wanted someone like that in charge. He won because those things are LIES from mainstream media and people saw through that bullshit. The people that think that its "insane" that he won are simply like the blind person that doesnt want to see, no amount of evidence will change their mind because they simply cant bear seeing. Most people will rather live in denial than change their minds, and you know what? I get it, having heard so many reports of people having mental breakdowns from having to face painful truths or from doing psychadelics I now understand that mental flexibility and being able to accept mind blowing truths (the media lied to me all my life) is too much for a lot of people, living in denial will at least prevent a mental breakdown, depression and potentially suicide. Timothy Leary was wrong. Change has to happen slowly as to prevent people from freaking out. So now I have more empathy towards people, I did well on psychadelics but I wouldnt recommend to most people, I think that people that do well on stuff like that are the exception, not the rule. Let the blind be blind, they might be better off at the end