TheLearningTrader_

@toy59496 this is fucking depressing

Small Cap Investing is Dead with a 77% spike in Tax Collection I have run 1,000 Monte Carlo simulations of portfolios of 20 Small Cap Stocks with the New Inflation Corrected CGT model versus the existing 50% CGT discount model. The results are devastating. The bottom line is that small caps are highly asymmetric bets where your small number of winners are meant to compensate you for your many losers. Mining companies are a good example of this situation and are a fundamental pillar of our national wealth. However if you tax those few winners at 47% with the trivial relative inflation correction you effectively wipe out the ability to offset your losses. This is because the tax drag on your few multi baggers is so high that it changes the entire logic of the investment process. It's become a loser's game. 1. ​The Moonshot Tax Penalty: Because Australian small caps rely heavily on a right-skewed distribution (a few massive winners offsetting many losers), the Indexation framework introduces a devastating tax penalty. For a stock that goes from $50,000 to $400,000, a 3% inflation adjustment on the original $50,000 cost basis is completely negligible. Under Indexation, you forfeit the 50% discount and pay a flat 47% on nearly the entire gain. 2. ​The Turnover Trap: With a 15% annual turnover, small-cap portfolios realize taxes continuously. Under the current system, every partial sale triggers a flat 23.5% effective tax rate, leaving more money inside the portfolio to compound. Under indexation, those early wins are hit at a full 47% clip, severely dampening the portfolio's forward compounding engine. 3. The Asymmetric Loss Failure: in small-cap investing, a stock can only ever lose 100% of its value, but explosive winners have unlimited compounding upside. The government’s asymmetric tax system completely devastates this dynamic: by replacing the flat 50% CGT discount with inflation-indexing for winners only, it leaves your nominal losses capped and completely unable to counteract the massive tax hike on your multi-baggers. Because a 3% inflation buffer barely dents a 400% moonshot gain, you end up paying a brutal, un-discounted 47% tax rate on the very winners that drive a small-cap portfolio's success, causing a 77% spike in total government tax take overall. Even in investing we see the socialist government wants us all to be the same. Communists. (Technical notes: Model executed using Gemini Pro with 1,000 portfolios of 20 stocks each with the volatility and median return typical of this class of small cap stocks over the last 10 years, using a geometric mean process to step forward each portfolio each year).

@JakeNomada which would be your ideal destination for a 29 year old guy, no kids; remote worker so can go anywhere

Many will disagree with me... But I do believe you can raise globally competitive kids outside of the western world I do think kids going to high-end, fully bilingual private schools in these type places: - Santiago 🇨🇱 - Monterrey 🇲🇽 - CDMX 🇲🇽 - Panama City 🇵🇦 - Buenos Aires 🇦🇷 - Punta del Este 🇺🇾 Will be setup to do well in life as they become adults

@toy59496 Yep, planning on it

@trader54798 You are going?

AFR Mining Summit 27 May Perth live.afr.com/miningsummit/ Anyone going? I've been previously and it was interesting, although I don't think it made me money... You do get to eyeball management and make a "tool or not a tool" assessment. Where do you mining groupies hang out for meetings?

@asxbulll has happened so many times to me as well; just gotta think of it as tuition, embrace the lessons and get back on the horse immediately! Things will get better

A couple bad days wiped out a lot of hard work. I was so close to nailing some great trades past couple months but still took small losses. Got frustrated and impatient and paid the price for poor sizing. Need better discipline. It feels like it’s a long way back.

@toy59496 @cjoye for sure, I am 28 without kids and not married so I am contemplating a few years elsewhere to see what life is like and better explore the taxation arbitrage potential.

I spent 2 years in Paris and it was amazing, you learn different things with different people and different views. I'm not sure that's going to change your tax position though, but it certainly changes your life. Even New Zealand is starting to look attractive.... We do all sorts of arbitrage, and I post a lot about arbitrages, but one of the most important arbitrages you can do is taxation arbitrage. The multinationals do it, you have a look at what Microsoft does for example and it's just mind-blowing. And there is no reason that an individual can't do it, it's just we aren't programmed, and you have to be careful that it's legal because the ATO has teeth, and they will use it. Best just to be a non-tax resident.

Goodbye the Lucky Country afr.com//markets/equit… An exceptionally well written article on the death of the Australian dream through gross fiscal irresponsibility, theft, and importing overseas voters... And he's right because my capital is certainly not staying. @cjoye

@toy59496 @cjoye thank you for your deep insight as always mate really appreciate it. The more I start learning about tax, the more I realise how shit it is here in Aus; it is a shame but moving to a new country would also be a really nice experience in my opinion.

Yes. The difference is I have always known that Australia is non-competitive because a lot of my extended family is already in a low tax jurisdiction. I see what they pay and I look at what I pay and just shake my head. The other thing is I went through the CFA curriculum and they have a nice little chapter on taxation internationally which really gives you a very good view of what's going on from country to country. You can probably download one of the older years chapters. I haven't done the CFA I just read the books.

@TheOneLanceB @Qullamaggie 6 years and I’m only just starting to taste a bit of profitability…the grind continues 🙏🏼 still nothing else I’d want to do with my life

WHEN SHOULD A TRADER QUIT? The @Qullamaggie chapter of the upcoming Market Wizards book has been making the rounds. In it Kristjan discusses how he blew up multiple times. Many great traders have. But that begs one of the most important question of all: when should a trader quit? When should one persevere? Most traders fail, so how do you avoid sticking around forever if you don’t have what it takes?

@paxtrader777 Hey Pax, if you could go back in time what would you have done different in terms of taking care of yourself? I am 28, 6 years into the grind and doing my best to heed all of these wonderful lessons I see from you experienced guys

I am 57, I look young for my age(at least my wife thinks so), I feel young for my age and I act younger(see the videos from Miami). However, I started as a runner at CME in 1988 without knowing a soul either in the floor or in the business. I worked every job up to earn my shot at trading. I chose to become an independent trader an not a floor broker because I wanted an unlimited upside(See my pinned tweet for more). After 38 yrs in this business, 28 as an independent trader, the stress & intensity has taken its toll. I have heart problems as well as prostate cancer. I have an eye disease called uveitis which has caused cataracts and glaucoma. I didn’t take my physical health seriously till my later 40’s. Do not neglect that. Everything I warn against on X or in my @NTLiveMedia shows I have done MANY times over. Listen to me if you want, disregard what I say at your own peril. I do know what I am talking about. I have made very mistake so you don’t have to.

@LargeFamDad If you feel the need to make a post like this it is definitely cope 😂 why must you try and brainwash others into thinking that the way YOU chose to live your life is the right way? Get back to cleaning nappies and let everyone else live.

My boss's boss is like 42, never married, no kids. Earns $275-300K per year. Goes on a minimum of two international vacations a year w/ his girlfriend. 10+ days, all out. Eats the best food, stays in top notch accomodations. Excursions, tours, nicest beaches, etc. Great guy, I'm happy for him. But what I've realized is that without kids, you end up chasing a lifestyle that has to continually be topped in order for you to be satisfied and find happiness. What he and others like him don't understand is that when you have children, seeing THEM experience life's most basic things and watching their eyes light up at all the "firsts", brings greater pleasure and joy than any vacation or travel experience ever could. Seeing THEM try blueberries for the first time is greater than dining at the best 5 star restaurant in Europe. Seeing THEM learn how to walk is greater than walking the Great Wall of China or strolling along the most picturesque beach. Watching THEM giggle uncontrollably at "peek-a-boo" tops any A-list comedian act. Seeing THEIR excitement when building a fort out of cardboard boxes and making a door big enough for daddy is superior to staying at 5-star resorts. Flying kites with THEM far outweighs excursions like parasailing or helicopter rides. Seeing THEM perform a recital on stage for the first time is more rewarding than watching a Broadway show or top notch symphony orchestra. ----------------- When you have children, all of a sudden you realize that life's greatest joys are not in the pursuit of things or pleasure or travel, but rather in the LOVE and bond you share with your very own image bearers. Seeing the beauty and magnificence and wonder of life all over again for the first time through THEIR eyes and expressions gives you something the world simply cannot offer, nor even come close.

@mjhtrades do you fit it all into one carry on bag or its own checked bag? Sorting out a travel setup atm but struggling to figure out how I will actually transport everything.

Bored on a plane back to Dubai so thought I’d share my latest travel setup I’ve been using for the past couple of weeks. Laptop is the same dell 15inch 4k res 2 x 18 inch 2k portables 1 x 17 inch 2k portable (lightweight desk mount holder) I also use an iPad off to the side connected through an app called Spacedesk (isn’t counted toward resolution graphics output.) It’s all super lightweight though.. technology just keeps getting better and better.

@toy59496 Was the cheeseburger any good at least?

Huge Cost of Food in the USA Just had lunch with the kids... Total AUD$260 (USD$182). It was really nothing special. How do these people afford to live??!!!

@Valckrie did you use Claude to build this?

$CRWV +5.1% - powering Claude. Multi-year compute deal with Anthropic just dropped. $LITE +5.4% - order backlog + PT nearly 3x'd to $1,225. My premarket gap scanner auto-summarises every catalyst using AI. One glance, instant clarity - no more hunting across sites. If this is the start of a new bull run, there's going to be a lot of stocks making huge moves from these major catalysts. With this tool, no excuse to miss anything anymore. This plus alot more is available in my app, link in profile.

@toy59496 but given that there are so many models, I have struggled to decide which one to focus on (and pay for) given my limited funds

@toy59496 wow thanks for being so thorough mate! I am beginning to dabble with Claude (I do not have a lot of money to afford the $200 version) but have contemplated the $30 per month version; I want to see if I can optimise my intra-day and swing trading processes

$4DX.AX : Error Analysis Always good to assume the market is right and then do a retroactive analysis. x.com/toy59496/statu… So this company has been a 28-bagger in 11 months. I have done an analysis on the trigger points that were missed, where the thesis was wrong, and what should have been the pivot points. I've also looked at where we are now. You might find this flowchart of interest.

Trader check-in: how’s 2026 treating you? Answer with a GIF 👇

@jtrader perfecto! no conozco a nadie en medellin, seria super conocer a un fellow trader jaja, te mando dm cuando vaya byo, gracias!

@trader54798 yes i am from medellin! hit me up if you come

Friday market close.

@toy59496 damn, what car do you have

Fuel Cost in Australia Filled up 3/4 of the tank at a busy petrol station late last night. It's not sustainable...