On High Conviction Investments

On High Conviction Investments.png

Trading has always been an elusive game to me. I've never enjoyed sitting in front of charts for hours upon hours each day and trying to guess whether a stock or cryptocurrency would go up or down. Over the past several years, I've moved toward high conviction investments.

Instead of trying to guess the short-term price action of a stock or crypto, I would find a handful of companies or projects that I thought had a lot of fundamental value. Value investing is a term frequently used to describe this approach.

Value investing is certainly a part of it, but I look for high conviction investments with asymmetric upside.

My highlight reel for the past 5 or so years:

  • AMZN
  • TSLA
  • SQ
  • BTC
  • ETH
  • LeoFinance (a startup I founded, but deserving of this list imo)
  • Most recently: RUNE

RUNE and Having Conviction

@nealmcspadden has talked about this idea of investing heavily enough to matter but not so heavily that you lose sleep at night. "The Whale Rule" if you'd like.

I discovered Thorchain from @shanghaipreneur who also showed it to @jk6276 and @nealmcspadden. The 3 of them investing in the project and talking about it was enough of a combination to get me to start looking into it.

Since I've had a lot on my plate for the past year, I struggled to find the time to deeply research it. Instead, I would read Prof K, JK and Neal's posts and comments about the project and occasionally do some google work. Lurking on their Twitter account provided a great deal of insight as well.

A few weeks/months passed and I had slowly picked up some knowledge on Thorchain. I started to buy some RUNE - albeit at a much higher price than Neal, JK and Prof K.

RUNE fluctuated wildly. Going from $0.30 to $1 in the timespan that I started buying. It subsequently crashed with the rest of DeFi and came back to $0.30.

It was at this moment that I started buying heavily.

I had become much more familiar with the project and their community. I was enjoying their weekly dev reports and I bought-in to the vision of cross-chain liquidity pools and how bridging the gap between the major crypto assets via a liquidity-oriented project could be a massive hit.

DeFi and Liquidity Pools

Around a similar timeframe, we launched Wrapped LEO and I started to understand the DeFi industry from a much more nuanced perspective. Pooling became an obsession of mine as I researched and stalked various protocols and gathered ideas about what DeFi was at the time and what it could be in the future.

In all of my research, I continued to find that Thorchain was positioning itself to be the liquidity pool protocol for the entire crypto industry. It's not about pooling 1 or 2 or 10 assets. It's about bridging together blockchains and liquidity.

It's about creating an ecosystem of traders, LPs and validators in a very practical and economically viable way.

Reading through their whitepaper and starting to understand ideas like Determinstic Value, Incentive Pendulums and more, I realized that Thorchain had the most exciting tokenomic structure that I've ever seen.

Needless to say, I continued to buy heavily around that $0.30-$0.50 range. As RUNE fluctuated, I continually bought more and more.

At the end of my buying spree, I held a sizable position in RUNE (50,000+ coins) and I realized that the project was going to the prophecized $6 and even beyond that.

Today, RUNE hit $4 for the first time ever. It's incredible to see the rise of this project as it moved from hidden gem to one of the most talked about projects in all of DeFi.

.. and it's just getting started. Native Bitcoin pooling isn't even here yet!

My point in this post is something that I talk about often when it comes to how I invest. I made most of my money in Bitcoin and ETH by being early to the industry and RUNE has been one of my most profitable investments in the past 2 years.

I didn't do this by having a light touch. I didn't do this by sitting in front of charts for 12 hours a day. I did this by finding projects, assets and people that I could cultivate a high conviction for. I deployed my capital in a way that directly reflected my conviction for what existed in the moment and what I believed would exist in the future.

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27 comments
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Although I'm not invested in RUNE I acknowledge it as the Leofinance community official shill and so far it has play out well. I'm excited and confident as well with my UNI investment. Congrats for RUNE and also everything you've done with LEO.

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Exactly how I started. I tried that day trading thing for a bit and YUCK I don't get how people do it. Instead I'm long game now with steady returns and projects which I feel have good values, promise and seriously just good people behind them. Investing in a "company" is investing in people which is something I have come to love over the years.

I missed out on RUNE (still most likely not to late to get in so I'll be checking it out some more)

DeFi reminds me of altcoin rallies and after that ethereum token rally. Lots of money will be flowing through it this year.

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Nice humble brag about buying RUNE at 30 cents 😉 All fun a side I'll thank you for opening my eyes to DiFi just through the interaction I've had on LeoFinancce to date. Value investing makes a lot of sense for many, and what a great time to be looking at the fundamentals of DiFi business out there like Thorchain. It was only recently that I re-jigged my portfolio to increase exposure to DiFi and pooling projects. Thanks for reaffirming my decision to do so.

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What about HIVE and BAT, still got that conviction? I know you build on hive, but I am talking as an investment.

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i bought into rune around the $1 mark after reading about it here. To all the people you mentioned who wrote about it on leofinance, thanks!

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I was cash strapped and sold around $2.5. Now getting back in is a problem

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I went into a Chaosnet RUNE/USDT pool and this recent spike we all waited for lost me a great amount of precious RUNE.

Going to make a post about it tomorrow. Now I'm waiting for the price to fall a bit to take out this liquidity.

But overall I'm really grateful to you and the Leo community which made the biggest impact of buying RUNE in the first place.

This community rocks! Let's keep going!

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(Edited)

The RUNE/USDT pool is long trade - for 1 year minimum (just to slow down the RUNE's mooning). I got just $200 in this pool just to wait for very long time like years. After 1 year you get IL+fees on sub zero. After that every day gives you more and more...
Just try https://runedata.info/ if you don't know it...

Happy LPing!

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Love to see a seriously thought portfolio, both in stocks and cryptocurrency. And luckily enough for me as I've been with this community and I've read almost daily the post, I could invest in most of them. Just a great feeling when opportunities present and you jump on them, I am so happy for example with the RUNE use case brought to my attention by the community posts and video streams on it. Thanks for your hard work and building all this community from the ground up!

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Congratulations for these great investments, the truth is an example for new investors that are acquiring knowledge within LeoFinance, I am one of them.

I came here knowing practically nothing about cryptocurrencies and blockchain, I liked finance but from another field, however, I have learned a lot with my arrival to hive and Leofinance, I know I'm starting my way as an investor, but post like this showing the experiences give a nice value to this community for new investors like me to be motivated and learn from those who have a lot to teach.

Great job no doubt, I wish you success in all projects.

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This is really good advice (so long as the conviction comes with research and understanding -- which in your case, it clearly did). I don't have a ton of capital to invest, but I started noticing Thorchain about a 6/mo. to a year ago... thought it looked good.

Thanks for the perspective. "High Conviction Investments" definitely seems the way to go. Cheers!

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(Edited)

I share the exact same attitude towards trading and investing...I’ve seen you mention Rune before but because finance isn’t the thing I posts about most, I missed out on posts that had a lot of detail about the fundamentals. Perhaps they’ll replace the other defi on my 2021 top 10 prediction post...

Square is my biggest investment besides Hive and bitcoin too, I missed Tesla cause no money at that time...

In any case this project is at the top of my list. If anyone could redirect me to a Leo post about why it’s special, I’d love to learn about it from someone here 😃

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I think AVA from Travala will also fall in this category

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AVA was my RUNE.

Bought most of My AVA at 0,1$ between 2019-2020. SO I understand khal feelings there.

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Oh man, I'm just going to buy any token you shill from now on. I hesitated on AV when it was like $0.4. Ended up buying in around $0.8. I'm still in the green though, so i can't complain. Wish I got in sooner

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(Edited)

I did it exactly like you. Till november '19 to january '20...

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I'm also a fan of the Whale Rule:

@nealmcspadden has talked about this idea of investing heavily enough to matter but not so heavily that you lose sleep at night. "The Whale Rule" if you'd like.

After some years here I've realized that it is a powerful rule, I've adopted it into my investment strategy.

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Besides LEO itself, I own my RUNE investment to you and @jk6276 (I think I never saw Neal talking about it besides your mutual videos and this one time when he explained how to turn LEO into RUNE). Where do you discuss these things? On Discord?

I have now reinvested a bit of my RUNE gains into LEOM. I missed the boat back then and now I was finally able to get my hands on a bunch.

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Wow. Thanks for sharing this story. Learnt something new here about you. Like you, I dislike staring at charts, it just stresses me out.

I got seriously interested in Rune during the 50 cents to 1 dollar phase but - for several reasons - I didn't ( manage to ) buy in. Trying not to feel the FOMO but right now I'm seriously wondering if 4 dollars is still a good price to buy in. Do you expect another dip soonish?

Cheers!

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I am good with numbers and understand trading. But i am against pumps and dumps, even when they are made for the right reasons. In the end, somebody will always pay the price.

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This is another example of premium worthy content here for free. I just bought some Rune, you can say I'm late, but this one is going to be a long run thing for me. Ive not understood the Chain from other posts as I do yours ,, so there's that. Keep the posts coming, gracias.

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I soon grew out of day trading myself. I was doing well and I still occasionally day trade and swing trade. Still over 95% of my portfolio is on the HODL mode.

PS: LeoFinance is actually doing very well on search results. The efforts to get users more educated on SEO seems to have helped:

DuckDuckGo.png

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