Trading strategy should adapt to personal temperament on the tech adoption curve. If you're always buying high and selling low, maybe you're not as cutting edge as you think you are in that domain.pic.twitter.com/NhNlIMjCnA
Show this thread
-
What this collective self-delusion creates is sth I'll term the seed/sapling delusion. The belief that you're buying seeds when you're actually buying saplings. You've already missed out on the massive % growth from seed -> sapling and it's now the sapling -> establishment phase
Show this thread
The seed -> sapling phase is mostly innovative and experimental. It's an entirely different set of philosophies than the sapling -> established tree phase. It's like the difference between science and engineering.
-
-
The two phases have fairly different capital deployment strategies. VC firms and hedge funds are different and can have wildly different valuation strategies.
Show this thread -
VC has a *much* higher tolerance for failure. Also this means you should never take a job rec from them:https://twitter.com/a_yawning_cat/status/1253741871509041152?s=20 …
Show this thread -
What the seed/sapling delusion often does is that it attracts larger sums of capital because the money going in thinks it can get seed level gains but the requirements for entry are higher since the sapling has a higher metabolism.
Show this thread -
Since the sapling is not established, the volatility remains high and are *not* offset by potential seed level returns b/c it's already past that stage.
Show this thread -
One way to mitigate this trap is to fill your life with technologies that span the categories all the way from innovator to laggard. You're personal response to these things will keep you informed to your actual temperament and not how cool you actually wish you were.
Show this thread -
Personal example. I recently considered buying PAWZ b/c I felt an insight of "ppl buy pets for pandemic loneliness." The jump at this chart's end though makes me suspicious that this wasn't a personal insight but cultural osmosis. My 'insight' is lagging the market, not leading.pic.twitter.com/j2Hlh2mdq4
Show this thread
End of conversation
New conversation -
Loading seems to be taking a while.
Twitter may be over capacity or experiencing a momentary hiccup. Try again or visit Twitter Status for more information.