Do it your way, Think like a farmer, Breaking up Big Tech: Cui Bono?
Hi readers,
This week I’d like to share with you these ideas:
Think like a farmer investing mindset
Do it your way
Breaking up Big Tech: Cui Bono? - Aswath Damodaran
1. Think like a farmer investing mindset
Investing mindset of a “farmer” can be effectively applied to investing.
Just like a farmer tends to their crops, investors must adopt a patient and strategic mindset.
Let's break it down:
1. Don't shout at the crops (investments)
Mr Market does not care about us, our any of our feelings.
Warren Buffett calls Mr Market “the poor fellow with incurable emotional problems”.
It’s counterproductive to have emotional reactions to market fluctuations. Staying calm and rational is key.
2. Don't blame the crop for not growing fast enough
Investments take time to mature.
Patience is crucial, and unrealistic expectations can lead to poor decisions.
3. Don't uproot crops before they've had a chance to grow
Avoid the temptation to sell investments prematurely.
Give your portfolio time to grow and compound.
4. Choose the best plants for the soil
Select investments that suit your goals, risk tolerance and financial situation.
5. Irrigate and fertilise
Regularly contribute to your investments, such as a and reinvest dividends to drive growth.
6. Remove weeds
Just like if a farmer does not cut away weeds, the plant will not grow healthily, neglecting underperforming stocks drags down your overall portfolio performance.
Periodically review and rebalance your portfolio, identify and weed out consistently underperforming assets. It is easier said than done, because there is often a lot of emotional attachment you have towards the stock.
"Selling your winners and holding your losers is like cutting the flowers and watering the weeds.” — Peter Lynch
7. Remember good and bad seasons
You can't control the weather, only be prepared for it. Market cycles are outside your control, so maintain a long-term perspective.
Focus on proper asset allocation and risk management to weather various market conditions.
“A climate of fear is your friend when investing; a euphoric world is your enemy.” — Warren Buffett
2. Do it you way - Morgan Housel
“100K by 30”, “Retire by 50”.
These are common mantras that are made popular by society.
I often see people chasing such financial goals without a purpose, just because “everyone else is doing it” which leads them to unnecessary stress and burnout.
When we benchmark against such arbitrary financial goals, we are chasing someone else’s idea of success.
This article by Morgan Housel reminds us that the ultimate measure of success is getting what you want out of life, not what society suggests.
Develop your own compass and personal benchmark and be focused on your own race.
Read more: Do it your way
3. Breaking up Big Tech: Cui Bono? - Aswath Damodaran
Large tech companies such as Alphabet, Microsoft, Amazon, Apple, and Meta dominates our lives and and hold immense power.
On October 9, 2024, the US Department of Justice indicated it might pursue a break-up of Alphabet.
In this video by Aswath Damodaran, he explores the evolution of antitrust law in the US and it’s potential effectiveness against big tech.
Watch: A Big Tech Breakup: Cui Bono?
That's all I have for you today.
If you enjoy this post, the best compliment you can give me is to share this with one person who would benefit from it.
Stay curious and see you soon.
Cheers,
Tess
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