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Reflections on Five Years of Active Investing and Trading

Tuesday January 12, 2021

Some of you in the blog audience have asked me to share advice about investing and trading. Let me just share a couple of meta-advice bits right up front, and then I’ll get into more details:

  • If you want to do this kind of investing or trading stuff, but haven’t dived in yet, calendar a deadline for yourself, by which deadline you will:
    • Have an investing account, app(s), and your notes/framework files ready to go
    • Make your first asset purchase
    • Begin tracking and measuring your results (in a spreadsheet, for example).
  • If you don’t start by that deadline, tell yourself what you’ll do—don’t give up. Take at least some little step.
  • As for me, I’m a dummy. I’m not a veteran investor or trader.
  • Being a dummy helps me to get a little smarter over time. Being a smarty generally makes me dumber over time. If you have been reading the blog, you know this theme: Dumb, Dumb, Dumb.

Enter The Loop

One of the most helpful practices I’ve brought along on my investing voyage is the A2i Loop. It has helped me to maintain a generally comfortable grip on projects and outcomes, while keeping actions and perceptions open and loose.

The loop also went meta, generating three sub-projects, with fun code names:


BOOMER was the code name for my first serious foray into investing. It was meant as an investing-only framework, not trading. This project evolved until I finished reading How to Make Money in Stocks. After I finished the book, I realized I wanted to try a more active asset trading approach.

Working on BOOMER, I doubled my small investments within 4 years, and realized that I had enough experience with math, money, business, and psychology to leverage toward good results.

BOOMER felt entrancing. Exciting. I had experienced so much devastation in my life prior to BOOMER that I hesitated at times to think it could really turn into something positive. Still, I wanted to make extra sure that was the case. I wanted to look into things and measure things.

FALKONLAZER was the code name for my next project, which was my first active trading project. FALKONLAZER had the following components:

  • Actively Updated and Refined Frameworks and Notes
  • Ongoing Education Plans
  • Research Frameworks
  • Experimental Frameworks
    • Experiments in Leverage
    • Time Scope Experiments
    • Asset Class Experiments
  • Active Measurement
  • Specific, Outcome-based Forecasting

FALKONLAZER resulted in another doubling over the span of about five months. The results were exciting, the experiments frequently fun but also sometimes terrifying. I experienced radical emotional swings at first, and frequently found myself coaching myself through those. I tried to be my own best coaching client.

Overall I am really, really glad to be done with that first big foray into active trading, just like I’m really, really glad to be done with 2020.

FALKONLAZER ended on December 31, 2020, with some of the more productive components retained moving forward.

Though there were a lot of wins, some of the biggest mistakes I made during FALKONLAZER were:

  • Ignoring sector setups
  • Ignoring sector rotation
  • Ignoring indices
  • Ignoring market caps
  • Buying based on individual stocks and tight (usually daily & weekly) charts

Does that sound dumb to you? GOOD! I agree. That’s the plan.

I didn’t know how important this stuff was until the end of FALKONLAZER. I realized that what I needed was something more like a fundamentally solid technical platform on which to base my positions. Enter…

PLATFORM FALCON. I needed a new project to assist in the rapid maturing of the FALKONLAZER energy being brought forward. This new project marked the generation of a mature platform, hence the name. So I also replaced the K in FALKON with a C, which is the marc of a really mature, upright name, in my opinion. ;-)

To use an airplane metaphor, PLATFORM FALCON is less about individual airplanes (individual assets or stocks), and more about the squadron (groups of assets), squadron management, and the area of activity.

PLATFORM FALCON is about injecting more security and risk management into every trade, while also increasing the upside by leveraging the verification of factors like institutional support.

PLATFORM FALCON has produced a couple of simple models so far:

Model 1: SISSY

SISSY stands for “Sector, Index, and Security; Sweep to Year.” In further detail:

  • Sector: The Sector in question (finance, energy, whatever it may be) should be at oversold levels, or on the upswing. It should show signs of initial waves of institutional interest.
  • Index: The Index in question should be doing the same. However at this level, I look closer at charts and technical analysis of an index to determine entry and exit points.
  • Security: The Security in question should be well-discussed by groups, OR it should be qualitatively well-regarded by well-regarded folks / models. There should be some clear support from big buyers. Volume support should be obvious, for one. The Security should show a solid history and ideally does not look sketchy at all when deeper research is completed.
  • Sweep to Year: Charts from a scope of one year down to one minute are browsed for technical patterns. (A previous trap was only looking at the week, or day, or hour chart) This includes sticks like the bull hammer, three green soldiers, H&S, cup with handle, bull flag and pennant, gaps, golden crosses, etc. Even if one of these indicators doesn’t seem to work in isolation, recognized patterns of all of them definitely help.

Model 2: “You Left a Tip, Now Buy the Dip”

This is a simple quote that reminds me to build on profits by buying low, rather than piling more profits onto last-gasp maneuvers by assets that recently exploded in value.

“You Left a Tip” means you got cocky, added risk on risk, and just handed some of your profits back to the market on the way out the door (implies additional loss). Like leaving a tip for the market—and sometimes a huge tip!

“Now Buy the Dip” means—hey dummy, look for a nice oversold position and put the rest of the profits there.

I try to develop little personal quotes and memes like this, because sometimes you don’t need a list or a formal framework structure. Sometimes it’s more like a fun quote, hopefully a bit catchy, and that’s helpful too.

PLATFORM FALCON has been a success so far, but it hasn’t even been a month yet. I’m up 20% for the month as of January 12 (Edit: Actually I just double-checked and realized it’s more like 50%).

January is generally a good month for stocks though, so I do hesitate to even guess what February through April will bring. I might even lose it all! Doubtful, but I just want to drive home the ever-present need for risk management: Always set stops, always protect your capital.

Being an INTJ in This

Working on being “some kind of Jungian superhuman,” as I’ve heard some mockingly call it, can feel like a liability sometimes, when you interact with people in the finance community. This can happen in any community.

In finance there are lots of awesome people. But there are also a lot of INTJs, ESFPs, and many other types who are just…well, they can be far too easily described by the assets and liabilities of their personality type. This is the “personality type” factor that made Jung cringe.

This is not my favorite thing to witness; I find that I want to evangelize, just like anybody else who has tasted the fruit and enjoyed it, but I try to be patient even when it’s hard. For example, I’m not perfect, but I’ll be damned if I’m going to let somebody who was practically born with business acumen tell me that politics are counterproductive, or that we should let business freedom and business transactions determine politics. That’s a classic INTJ-ESFP argument born out of Te-Fi valuing psychology. It’s a traditional setup for an AM radio talk show, but it has a lot of leaky holes in it, again to the degree that it over-values a sub-type of group psychology.

To put it directly, there are some really amazing people who can put the finance world into perspective, and then there are some really good people who are open and flexible and fun to chat with, and then there are…the rest. (People are different online than in person though, as always. Maybe more tormented while communicating online, for example, getting out some of the negative energy from a hard day at work)

Rant over!

Anyway, these qualitative observations are why I have tried to make sure my personal goals in finance are backed up by other supporting and co-creative goals in areas like:

  • Charitable giving and donations; supporting important causes
  • Charitable work—giving time to organizations and people who need it
  • Giving back to the community by sharing what I’ve learned (i.e. this article and others like it)

I have code names for those projects, too, and I build on them over time…


2020 was an eye-opening year. The world desperately needs more education, more patience, more giving, more sharing, more openness, more creativity. An ultimate fail for me would be gathering a bunch of new assets all around me, and then sitting on my pile of assets without using it to further those constructive ends so that others can benefit.

I continue to believe that it’s possible to create things that haven’t been created before, and to do things that haven’t been done before. I’m a big fan of the “expanding the pie” approach and have seen it work amazingly well. Some of my coaching clients have taught me impressive lessons about this, too.

Moving into 2021, I’m excited and optimistic, but I’m also feeling more grounded and ready to integrate the extra practicality these plans need in order to work.

Good luck with your goals in 2021 everybody! —Marc

Filed in: Openness /49/ | Planning /17/ | Coaching /27/ | Goals /52/ | Essays /52/

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