Dreams to Reality (2025)

You will be able to follow Linnea and Kirk, two full time travelers and investors, on their journey and adventures around the Globe.

07/12/2024

The Koh Tao/100k SEK week correlation continues!Palantir Technologies continues its surge reaching a staggering 360% YTD.

The portfolio loosely employs an adjusted Talebian barbell strategy approach. The strategy involves a portfolio composition of hyper conservative (Treasury bonds) and hyper aggressive (venture capital) investments allocated in a Pareto distribution.

This approach conserves the majority of the portfolio to rise with market returns whilst exposing a small percentage to tail events and exponential upside. Venture capital (at its core) is a process of throwing a hundred darts with the majority missing the mark. The few however that hit, recoup all the losses and then some(at exit) once a company IPO’s in the public markets.

There are avenues into the primary markets available for retail investors, however, the portfolio uses leveraged instruments on public companies instead. This week the leveraged certificate on Palantir Technologies moved the needle for the portfolio.

The use of a daily leveraged certificate (as opposed to various other sophisticated instruments) caps the potential for loss of only the principal amount exposed. Essentially, the portfolio sprinkles a negligible amount of capital across a plethora of different companies. The idea is that most ‘bets’ will miss the mark. The process will however, capture the outliers at the other end of the tail of distribution.

10/11/2024

The markets are surging after a change in leadership in the biggest economy in the world. The expectation is that a Republican led government will draft polices that are more conducive to business. Trillions of dollars have poured back into the equity markets after the announcement of Trump’s triumph. The initial surge due to change in sentiment has to abate.

The elephant in the room is inflation. The Federal Reserve has exhausted the best part of 4 years in its attempt to reign in inflation. The Fed accelerated interest rates at a velocity, and over a period of time not seen since the Volcker led Fed. A deregulation of the business landscape will inevitably lead back to the issue of taming said inflation.

Irrespective of the future conjecture of where a change of leadership might take us, I remain invested in the markets. In the long run, short term gyrations due to administration change, policy change, conflict etc plays second fiddle to time in the market.

09/11/2024

Mid-week saw a change of government in the US, with the markets moving upwards a day prior to the announcement with anticipation of a Republican presidential victory. The following day the markets surged with the news of the outcome and thus the tide lifted all boats on all fronts.

This single day return has been the biggest this year for the portfolio with it rising further to 136000 SEK at market close. The thrust of the move has been the core positions that I’ve held onto and have allowed to expand.

Exxon Mobil has been a position that I’ve held onto since 2020. Against the backdrop of hysterical lauding of renewable alternatives, I built a substantial position and disregarded everybody else’s insistence to sell.

Nvidia and Apple are positions that I had conviction on in later stages of 2022 when everyone was terrified of the markets and tech stocks in particular.

The portfolio has returned 116% YTD and what should be evident is that there has not been excessive speculation used to garner the returns. Exxon, Apple and Nvidia are household name stocks. There’s been no speculation in obscure ‘penny stocks’ nor does the portfolio contain exotic positions like an alternative currency or a jpeg depiction (NFT). Neither was there any use of highly leveraged sophisticated vehicles like stock options. No sexy trading from a computer with multiple screens, flashing lights, trading signals and the like was implemented.

Contrary to the false impressions of retail investors, it suffices to invest in a manner which is predictable, mundane, and yet daring. Avoid the noise, think rigorously about the decision, use as less data points as needed, act boldly, execute aggressively, and then do nothing. Time is the ally.

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