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Saturday, February 13, 2016

Anatha Bhaga

Bhaga, God of Wealth...and Love
Lord Vishnu is one of Supreme Gods of Hinduism, master of all, creator and destroyer... and he is slightly blue. (Wait, it gets better). Apart from having four hands, he also has a gang of 12 Adityas - your regular, everyday Sun-Gods. One of them is Bhaga, God of wealth, also responsible for distribution of destiny according to merits of recipient... ahem

God Bhaga maybe an obscure character, but is definitely connected linguistically to Sanskrit word 'Bhagavan', meaning 'rich and prosperous'. Further, it believed to cognate to Slavic бог ("god" /bog/); and to be an original root of Russian богатый ("wealthy" /bagatyi/). Good words do get around...

In Maharashtra state of India (central-left part of country) people speak Marathi, one of 23 official languages of India. According to Marathi-to-English dictionary (here link), the word 'Anatha' means:
either -That is without a master or protector; forlorn, friendless, destitute;  
or - Friend of the friendless. Brother of the destitute; protector of the helpless.

 India is such a mess.


After paying homage to some of biggest swinging dicks of Wall Street in Guru Puja post (link), I am looking around at what I got. This lonely traveler in search of  The Way is not doing too bad. There are plenty of good ideas in stocks that I follow based on various reasons, but mainly because of some common sense notions. I call this approach 'Theme Investing' aka System9. I tend to gravitate towards larger companies not just because all the action and liquidity is concentrated in these type of stocks, but also based on appearance of stability and viability of underlying enterprise. It other words there is less of a chance that these corporations are a complete fucking fraud. Mostly all of  'My Stocks' are real businesses, making tangible things or providing valuable service, and with a scale! Every ones in a while their stocks go up 10-20-30% for no special reason at-all.... just because. It happens often enough, sometimes these trends last for months, sometimes they don't happen for years. Sometimes I am wrong, or early.

In order to make money in The Market I need to answer these 4 questions:
WHAT to buy, WHEN to do it, HOW to bet, WHY to sell.

For the task of  "WHEN to do it" I developed Composite Score Indicator (CSI) - my proprietary formula to quantify and qualify price action of any actively traded security. CSI is a technique to hook big, major, most explosive trends and continuously know where I am in that trend, including an ample indication when the trend is over. Composite Score Indicator does not tell the future, it can not guarantee that position will be profitable. CSI Buy Signal does not guarantee that trend will indeed develop, but every trend has at-least one Buy Signal in the beginning. It just can not be any other way.

My view of importance or prospects of a Theme is just an opinion. I have to wait and calculate my Composite Score Indicator, because there is no way to know in advance if any group of stocks or industry will become an attractive investment. Financial speculation is a process of making an aggressive monetary bet, based on incomplete assumption, for uncertain period of time. As such it is very risky, prone to misjudgment, as well as susceptible to error in forecasting. By using Theme Investing and System12 for stocks selection, CSI for trade timing and conservative position sizing - I attempt to circumvent these difficulties with reasonable expectation of gain over time. The Market rarely makes sense (and I don't think is has to), but it speaks every day... I am listening...

This Anatha is a man without Guru. Alone, but not lost. Independence is my strength. CSI is my guide.

 “I can assure you that any specific projections I write down will turn out to be wrong, perhaps markedly so.” – Janet Yellen
“If you’ve followed my forecasts, you’ve probably lost a lot of money.”
– St. Louis Fed President James Bullard