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12/02/2017 ZYNE Issue 9 - Enigma gives you multipleX's, truth is where power grows
---Greetings :-D ---------
Welcome all new readers! Glad to have you onboard.
---General <>< -- General market
Market is dropping: two weeks ago we were discussing the valuation on Tencent, Had a ridicolous pricing of 130x yearly cashflow (3 billion USD/year against a 460 billion market cap),
The company is great no doubt, Wechat is a juggernaut but I'm not investing for 100 years to see the outcome :)
We have reduced positions in 0980.hk Lianhua to nil due to a cash flow discrepancy. Our cash position is 80% , equity position is 20% consists of twitter.
We are also well prepared for the opportunties that come upon us in the next few months.
---Growth _____-- Enigma
Enigma, is the space above an L foundation, This space is a strange area, you can't figure out whats going to happen, no one can, but you can see the current situations (perfectly managed)
while being safe as in net profitable, The Enigma is where multiplesX are made , because no one can really figure it out, the gains are in the unknown.
The enigma is useless when its not bracketed with an efficient managed operation while being profitable which is selling things people want!
There is an enigma even in piles of feces if its managed efficiently and its something what plants want.
Efficiently managed is something that must be seen in action, you must physcally walk into an operation and see how efficient and well managed the place is.
Are the bathrooms clean? Locate the dirtiest place and see how clean it is. Because if the corner is clean, most likely everything is clean, even the accounting!
Who can foretell the next 6-7 years? It must be in the management and also the curent state of gross profit.
/ is the enigma
| is the efficiently managed
___ is the safety or value line
---Growth _____-- Truth is what power grows on
Without the foundation of truth, beings can never achieve growth status. Truth is what math is , Truth is what nature is , the building blocks of truth allows further
truths to be placed above it. The stacking of truths, allow multiple angles of safety while allowing the power holder to choose and pick its weapon of choice, its angle of choice.
Complexity is stacked upon truths, Simple is stacked upon truths. Without knowing what is true, growth can not be stacked.
To be true is to be free, growth wants to be free.
---Investigative Analysis >*_*<--- Numbers in, Numbers out
With so much financial statements and numbers as the building blocks of public companies, things can go wrong if profit numbers doesn't match up, Usually they do match up. Most of the times
when a profitable company states 30% profitability on their financial statements, they are profitable. 5-10% of the times ,the profitable company which claims high profitability but never
seems to have more then $5 in the bank account after debt. There is where the truth doesn't play out. Bank account balances are truths. Everything can be deducted examining their bank balances.
Companies that seem to grow and grow but never have budging bank account balances, Warning signs should play out in your head. Where's the money going? Badly managed finances
or is the company blowing money on bottles and not inviting us for a drink.
---Value =) -- What am I getting other then a flying pie in the sky?
New York real estate isn't just real, there's monthly cash coming in every month to purchase bread and cola. Purchase a big land in rural Texas, you get to run around naked throughout your 200 acres.
Or if you prefer to be like Bezos and test rocket launches from his land. If you don't need the freedom of streaking or rocket launching, land choice in rural county is actually a liability.
The taxes every month you have to pay to the US government bogs you down while the nameplate of Landowner is alluring.
Landowner in NY and Landowner in rural county are two different things, what you have should return actual real-life value(money, grass for cows, testing area) for ownership to be a non-liability.
---Trade Management O\_/O -- I'm in but How to get out
Positioning should always align on one line of thought , this line of thought is supported by many other lines of thought. An example of a line of thought is: Company should send me
4% dividend per year for holding the stock. If the company suddenly cuts dividend such as General Electric (GE) on 11/2017. Your line of thought is derailed.
It is time to exit.
The best way to exit is to first cut 1/2 , think about the position for a week or so, if it's still dividend-less like (GE) then another 1/2 of the existing position.
1/2 at first , 1/2 after some thinking.
At anytime during an investment, if you have a new line of thought, it should be applied immediately! 1/2 cuts. The world changes and grows, your positioning should change with it, your actions
should reflect your new lines of thought.
Until next week or the week after... Zyne Letters.