The Exceptional Wealth Accumulation Ideas and Thinking Thread

[mazzatelli1000]

It's still gambling, though in my experience it is never productive to debate on the definition of gambling.

I should clarify that I agree with the methodology of raising the stop once unrealised profits are procured, and leave the trade with home run potential.

Indifferent with regards to the small cap strategy, I am a poor delta trader

 

[johnnyg]

What is that telling you about the tools you are using? About the information you seek? About the peers you keep? About what you learn from previous missed opportunities? About even your approach to the problem of positioning yourself?


If you still cannot see how to do these things in hindsight thats your problem. Your tools are rubbish and need replacing.

I've recently been in discussion with a family friend who runs a Real Estate Business. He has just purchased a commercial property for ~600K and has a good tenant lined up to rent the place for $90000 a year.

He said to me that after all these years of doing the same thing, he's just treading water as such, living an OK lifestyle, but as the thread states, nothing exceptional.

He had to borrow money from family and friends to get a good deposit so that the bank would finance the rest of the amount.

I guess that there was an element of luck or good timing in it that he has a tenant lined up ready to go and one that will pay good $$$.

Reading threw the thread I can see similarities.

He obviously realized to get an exceptional result, he had to do something different to what he has been doing for all these years (I think he is around 50).

I probably wouldn't say that he took a minimized risk, however he saw that his tools were rubbish and replaced them, he saw an opportunity and hoped on the train.

 

[Mr J]

I should clarify that I agree with the methodology of raising the stop once unrealised profits are procured, and leave the trade with home run potential.

I agree with it only so far as letting it ride as long as it still looks good. To maximise profit, trades need to be managed appropriately for the situation. If I'm properly managing my trades, I'll pick up nearly as many home runs, but be stopped out far less.

 

[MrBurns]

I've recently been in discussion with a family friend who runs a Real Estate Business. He has just purchased a commercial property for ~600K and has a good tenant lined up to rent the place for $90000 a year

15% return ? Where ?

 

[Portfolio]

Yes you CAN do this.
And no its not gambling.

lets say I buy a 10c stock with a 1c risk.
It trades to 13c I raise the stop to 10.5c I now have NO RISK.

More later.

Thats not risk free. Your stop will get hit 3 times for every time you make it 13c and have this so called "NO RISK" opportunity. So in getting to 13c you have already bourne the risk!!

My exceptional suggestion is that the free lunch on offer at the moment is res housing collapse. This is a no brainer as there is massive reward but little risk.

The other one is trying to be first onto the inflation play but this is still too early to call and the downside in getting it wrong it large.

 

[MRC & Co]

However, as credit is the only fundamental, loose credit conditions will result in a bubble... somewhere. Where individuals can kick goals is in trying to select the best manifestation of the same.

Likewise, a tightening of credit causes those bubbles to deflate or pop... exit time. Plenty over here rode the bubble, but didn't see the lance coming right at them. As a result, several "exceptional" fortunes became exceptionally spectacular bankruptcies.

The trick from here is detecting credit conditions and where capital wants to go. If accurate (and just a little bit lucky), you can go for the slap shot.

But nothing wrong with hitting singles until then.

*

No comment on this?

I think, this is the most useful post in the entire thread in relation to the topic.

Where to next?

 

[Portfolio]

FWIIW My previous play was shorting GTP all the way down. (and there were a few of us that did this). Once the yields were known this was only a matter of time. With GTP and the reason i also like the res property trade is that there has to be a trap. The trap with GTP was the low PE was constantly sucking people into the stock (people didn't realise it was low because the business was unsustainable). The trap with res is that people think "the property markets never go down" and most people still dont understand the correlation between asset prices and credit. Because of these myths people think that if credit decreases (its known this is going to happen) property can somehow still go up.

 

[MRC & Co]

Thats not risk free. Your stop will get hit 3 times for every time you make it 13c and have this so called "NO RISK" opportunity. So in getting to 13c you have already bourne the risk!!

My exceptional suggestion is that the free lunch on offer at the moment is res housing collapse. This is a no brainer as there is massive reward but little risk.

The other one is trying to be first onto the inflation play but this is still too early to call and the downside in getting it wrong it large.

Another good post which expands on Waynes post on credit/liquidity and actually points to an outcome (inflation play) if you are the first on it (if it is seen inflation is becoming a concern), or a housing boom fuelled by credit?

An idea from myself: how about a crash in Chinese stocks, a large reciever of their stimuli, whilst the economy actually looks in a bit more trouble than thought..........? Little stimuli going to 'real' assets or consumption? Perhaps prooven by the divergence between energy consumption and GDP growth in China? Are we seeing another divergence in their stock market from the 'real' economy, fuelled by credit and a current prevailing bias (world to be lead out of recession by China)? It is not just the boom that can be important, one can also trade the bust in a credit cycle.

 

[tech/a]

Hmm

I can see I am way out of my league here.
I will refrain from comment and simply learn.

 

[MRC & Co]

Hmm

I can see I am way out of my league here.
I will refrain from comment and simply learn.

Don't see the point of that post, but typical.

I see 5 pages, without one (sorry, there are a few, but not many) idea for the future. Funny considering the name of the thread: The Exceptional Wealth Accumulation Ideas and Thinking Thread.

Where are the ideas and thinking behind them? I don't see any.

How is anybody going to position themselves to get on one of these exceptional ideas, when they don't even know what they are? Where are they? What are they? How do you idenfity one? How do you get on one? Where is the stop-loss? Where do you pyramid? Too many questions, absolutely no answers............

 

[tech/a]

Don't see the point of that post, but typical.

I see 5 pages, without one (sorry, there are a few, but not many) idea for the future. Funny considering the name of the thread: The Exceptional Wealth Accumulation Ideas and Thinking Thread.

Where are the ideas and thinking behind them? I don't see any.

Let me be typically blunt.
Why bother.
All experts full of pre concieved ideas.
Your input in particular has been outstanding.

Most here wouldnt know a no brainer if they fell over it.

The thinking displayed here cannot be altered---doesnt wish to be altered.
We all rise to our level of in competence.

Carry on.
You'll survive without me.

How is anybody going to position themselves to get on one of these exceptional ideas, when they don't even know what they are? Where are they? What are they? How do you idenfity one? How do you get on one? Where is the stop-loss? Where do you pyramid? Too many questions, absolutely no answers............

Feel free to begin whenever convienient.

 

[skc]

Don't see the point of that post, but typical.

I see 5 pages, without one (sorry, there are a few, but not many) idea for the future. Funny considering the name of the thread: The Exceptional Wealth Accumulation Ideas and Thinking Thread.

Where are the ideas and thinking behind them? I don't see any.

How is anybody going to position themselves to get on one of these exceptional ideas, when they don't even know what they are? Where are they? What are they? How do you idenfity one? How do you get on one? Where is the stop-loss? Where do you pyramid? Too many questions, absolutely no answers............

Totally agree with your observation. And there are people who think this is a great thread.

To me the biggest challenge is minimising the risk.

I believe there are plenty of macro trends

- Peak oil is a great opportunity, so is green energy
- The collapse of Eastern european credit, as well as collapse of South American individual country are both pretty real

Locally, the residential property collapse is in play, and so is the consolidation of many industries that are not in duopoly.

If only someone can show me how to minimise the risk!

 

[wayneL]

One must develop a thick skin when posting ideas on forums. Not everybody will agree with them or even think them valid. "Toughen the f*** up" was a phrase I think someone used a while back.

However, one really, really, REALLY great way to *guarantee* opposition is to infer everybody else is a loser.

Human Relations 101 (not an expert in this field incidently ).

 

[Trembling Hand]

Nah it was smarten the ..............

 

[nunthewiser]

One must develop a thick skin when posting ideas on forums. Not everybody will agree with them or even think them valid. "Toughen the f*** up" was a phrase I think someone used a while back.

However, one really, really, REALLY great way to *guarantee* opposition is to infer everybody else is a loser.

Human Relations 101 (not an expert in this field incidently ).

anyways on a side note

once in a country city there was a nightclub area with no food available in 5 kms........ an opportunity sticking out like dogs nuts ......... stayed like that for 5 years! ....... then some bogan put a humble establishment outside nightclubs and killed the so called pig

same city

taxi plates and car . 150k . weekly take on said car average 3k ........ tax advantages too many too mention .do the maths

same city

same bogan used to sit on his front porch all redeyed and watching the port loading iron ore and building sheds and storage for a lil midwest iron ore co .....he thought wow there doing something here so he went and checked it out . same bogan poured all cash available and more into said unknown lil listed co and waited .......... waited , waited , waited .watched co grow FUNDAMENTALLY and as an actual bizzness

silly bugga had over 50% of his stock portfolio in said co that he had watched grow from a seed

returned 20 bags on the oppies and 12 on the mother stock

moral of story is ...OPEN YA EYES have a look , grow some nuts and give it a go

dont have to spend a million to make one

amen

 

[MRC & Co]

Where to enter: Either at an inflection point, one whereby the Government itself recognises the need for a tightening of credit (when rates begin to rise as is the cause of most crashes) or even when regulation starts towards further protectionism. Of course, you will have to be on top of fundamentals for these.

Or in the FMG example, how about once iron ore quality was recognised as poor? Or was this too late........

How about a break a final trendline in a parabolic trend (usually the sign of a boom/bust sequence): Stop above the high (the steeper the final trendline, the less risk as the tighter the entry, however the stop will generally be wide, but the reward incredible on a boom/bust sequence). Hard part is, choosing the right pivot highs and lows to use for the trendlines, if the pivot high or low is not a major one, you may be taking the wrong signal.

Where to pyramid? That is a tough question, for me, it would be on a pullback after a clear break has been established (i.e. ensure the first pullback does not come back to test the trendline, which would be above your entry). This way, you establish the break is severe and the first pullback is like in the chart below, far from testing the final trendline.

All easier in theory, than in practice. But it is a start for a beginner.

 

[wayneL]

Nah it was smarten the ..............

Ah yes, but thanks for the inspiration however!

 

[MrBurns]

No it was toughen the f... up. Chopper knows

http://www.youtube.com/watch?v=8_PFtBfqmZw

 

[So_Cynical]

Can I use a stop loss and risk 2% of my capital? That will definitely not deliver exceptional result.

Incorrect.

This will probably not deliver exception results in the short term, but once in a while, a 'normal' trade will exceed all expectations and take you to the moon.

U mean 2% of the moon...or maybe 4% with pyramiding

-------------------

On Topic...this thread gives me the feeling that someones gona try and sell me something. :dunno:

 

[Aussiest]

We want to look back on life and honestly say with a huge grin and sense of satisfaction.

"Life--What a blast!"


BE EXCEPTIONAL---you have a choice.

Yep, that's choice for you. Don't be a slave to somebody else's ideal, unless you whole heartedly believe in it. Live the life you want and tech/a is right, you will be able to look back and identify almost every step as one of choice rather than of slavery!