Battle Bridge

Why I don’t invest in the S&P 500: - only 25% of the index has a FCF/share growth greater than 15% - only 26% of the index has a return on capital greater than 12% - only 12% of the index has both of the above - I don’t want to own banks, airlines, energy companies, mining companies, utilities, heavy industrials and biotechs - I don’t want to own anything discretionary - I don’t want to own alcohol, tobacco or gambling stocks - I don’t want to own anything highly leveraged or highly cyclical What would you add?

$FICO reports earnings on the 28th, which adds an interesting layer of complexity to my current deep dive. While the core thesis remains intact, the speed of FICO’s recent evolution means this Ereport could shift several variables.

This is how my father, born during the depression in 1930 who would never buy anything new and reuse everything, built a ridiculously large portfolio. He began a farmer who later became an accountant. He would look at the books etc and buy and hold. He never sold unless the company was no longer the company he invested in. As long as they were doing things they said, even with hiccups, he would hold and watch it grow. Special dividends and all kinds of things came his way he never even expected. He hated selling. Hated paying taxes for no reason as he saw it. Watching the ups and downs. The swings of the charts, his portfolio, all I could imagine was the massive amounts of money he could have made selling the highs and buying the lows. For the next ridiculous amount of years I proceeded to try to do just that with my own money and was chopped to oblivion. Buying and holding the right instruments has accomplished for me what I could never do trying to outsmart the market. Unless you're a prodigy and can outsmart insiders and algos the best thing you can do is invest in a growing company that has proven they have done what they said they will do to give you the confidence to hold through all the market throws at you. Market wisdom in this post below.

Small story, back in my IB days, I used to cover sectors which no one covered. One of the sectors we built niche was exchanges (Stock, commodities, energy etc) Over the year, we built the largest Exchange practice as there was zero competition (Both Bulge bracket/ boutique banks like Avendus etc didn't cover), & we quickly became the Go-to Exchange I bankers Did 300 cr of block deal for NSE, IEX ( post Jignesh Shah, MCX fiasco etc) & made about $ 1mn fees for the company Was looking at our old pitch decks, we did a road show with every NSE blockholders who had liquidity issues ( like IDBI etc) We sold NSE at $3B valuation, current valuation of $60B , 20x in 12 years Just investing my bonus from the deal back in NSE post the 20X run would have have added to me tens of crores of networth :( Btw, my super boss ( Vikram Limaye one of the customers to whom I did block deal for went on to become NSE CEO and rest is history)