Important: We categorize investments in two ways. Strategic or tactical; occasionally, they can be both. Most of the trades we cover fall into the tactical bucket.

  • Strategic: Occasionally, we have insight into a specific company or theme and we are willing to make a 5-10 year bet to see if it plays out. In this category, we are looking for a business that has the potential to be a monopoly (legal of course), dominate their category, and build a durable moat.
  • Tactical: For these trades, we have a specific price target to take profits at and a stop to protect our downside. For more information on how we evaluate these trades, read this article.

Stability leads to instability

The headline is part of a quote by the economist Hyman Minsky. He was referring to the economy in general but we can also apply it in the context of business.

When a business reaches a certain level of success, they can, if they aren’t careful, become complacent. They can lose focus on serving their customers and meeting their needs. And if they aren’t careful, competitors will come in and start encroach on their territory. This process could happen so slowly, that upper management might not notice.

Then one day… boooooom…They’re in a fight for their lives and their very existence is at stake. (think Netflix and Blockbuster or the demise of Sears)


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