Business Articles, Insurance, Schmuck Insurance

Schmuck Insurance Is Pure Brilliance

If your a Saavy Investor that is a Professional it makes since to absolutely insure your future during a sale of a invested position for possible future capital appreciation! This will be a short post. But very rich information and rich in explanation. Let’s dive in.

First we need to explain what is the term Schmuck Insurance in Capital Markets Speak?

“Schmuck Insurance”

English Definition:

schmuck insurance (uncountable)

  1. (businessinformal) The situation where an owner sells a company but retains a portion in case the price appreciates in the future.

According to NEW YORK STREET LORE? SCHMUCK stands for “Stupid Person”

Example of How Schmuck Insurance can help you mitigate a very poor transaction decision without future knowledge of appreciation of your partially sold investment.

Here are some Examples of Schmuck Insurance in the Market by Institutional Investors.

Chamath Palihapitiya of Social Capital say’s Bitcoin is a Long Term Investment on CNBC…..

Example Number Two:

The Feared Activist Investor and US ARMY Veteran Carl Icahn of Icahn Enterprises goes after Pershing Square Founder Bill Ackman on LIVE TV! Reason? Bill’s Schmuck Insurance Clause and Herbalife’s Business Practices.
Is he right or wrong? You decide. However? I would tend to agree that all clauses need to be looked at in the fine print. Misunderstandings do happen. But? Sometimes we all know some Attorneys and Clients slip one in the fine print we don’t see. Here is the legendary Spat.

How to implement Schmuck Insurance and make it work for you?

What makes good sense as a good rule of Thumb for deploying Schmuck Insurance? Ask the question. Does selling your shares really mean you lose everything if you close out your initial Investment? Only if you sell all your shares. Sell 80% as a good rule of thumb and let the other compound or grow in a sub categorized long term portfolio? Pure Brilliance.

Don’t Sell All Of Your Investment.
I do believe it is good business to never close out your entire position without a little insurance. After all? We don’t want a situation where you sold to soon and your initial investment Thesis turns into a Situation where eventually your Investment SOARS in value.

Another great example is Sam Bankman-Fried. Sam in all honesty likely got overwhelmed with his Financial Situation and became slightly distracted. And add in the fact Sam had zero Experience Managing and Accounting for Funds received from Investors created a Nightare situation that he was ill prepared to handle. But look at the facts… Several of his Investments earned 100X BIllion in Returns. THATS INSANE! And eventually his Anthropic Investment earned his investors Billions.

I am not advocating Mr. Bankman-Fried did nothing wrong. However? Sometimes it’s best to allow the Professionals organized by way of a selected vetted Committee to keep you professionally safe, legally safe and even legally insulated from a over reaching US Attorney trying to misuse securities test (Howey Test) and charging a Company Founder with Federal Fraud Charges. Interested in More on Mr. Bankman-Frieds Investments that soared in value. Click Below for the full Article.

In the end to be Insured or not be Insured?

Given the situation I have just explained before you. If we get really creative as Investment Professional?

It would be a good idea to take this knowledge and keep it as a strategy when placing Investments or even eliminating partially sold investments into a sub categorized Insured Portfolio of Investments that have been Eighty percent sold but that last twenty percent is meant to keep you insured for future capital market resilient growth that may be unexpected. Pure Brilliance. Make sense? Good. Your welcome.

Thank you for reading. JS

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Business Articles, Hedge Fund Articles

Bill Ackman’s Eight Investing Principals That Make It Rain!

If you’re a serious about Investing, you will want to read today’s post on the Eight Investing Principals Wall Street Hedge Fund Manager, Bill Ackman uses as a foundational business strategy.

Most Retail and some Institutional Investors lack basics related to Investing and lack control of emotional temperament. So this is why you must study successful fund managers and re-engineer or use their strategies. Mohnish Pabrai is always laughing while saying, “He is a Shameless Copier in Business.” I admit that’s insightful.

Members of Congress have an incredible investing track record. Is it because they have inside knowledge? Or are their Advisors doing shady business on the side? Who knows! However, if you haven’t been paying attention to the Members of Congress’s investments that are listed publicly? You will likely be in for a surprise. Be sure to check them out here on Capital Trades! If you don’t know about ValueInvesting.IO you may want to check them out. They keep up to date with Congressional Members Investments. While I am on this subject?

Paul Pelosi or Congresswoman Nancy Pelosi’s Husband is a formidable Investor and has beat the Market with incredible accuracy over the years. And you may reach the conclusion that I have. Something just doesn’t add up when looking at the results and Data. However if they are using material inside information to trade by being close to Congress? I would like to think that’s highly illegal. But from my investigation it is not considered by Congressional Investigators that anything below board could be happening. Huh! That is strange. If your an Activists like most of us? You will like to keep tabs on Political Events. That’s wise.

Today I am strictly focusing on the Investing Principles from the Mr Baby Buffett of Wall Street and the King of activist investors, the talented and always respectful Mr Bill Ackman

If I could share some of the value principles Mr. Ackman and other Prominent investors have shared online? I think if you just keep being curious. And keep being a investigator? You will eventually arrive at the inescapable truth. Most value investors find from their Due Diligence Checklists. Just keep asking questions and learning as you go as a value investor. This makes the most sense. And something I learned from watching all of Bill’s Videos.

The Father of Value Investing
“Bill shared with me that Investing is something you can learn by reading.” Benjamin Graham is a man you should research if you’re interested in becoming the next Bill Ackman. Read the Intelligent Investor. I promise you will thank me later. Watching everything Warren Buffett and Charlie Munger have said on video also helps the intrinsic value of being among value investors pay massive dividends. But it’s all up to you! Do the work and do your due diligence.

What Is Bill Ackman’s Eight Investing Principals?

  • Simple.
  • Predictable.
  • Free cash flow regenerative dominant companies with large barriers to entry that earn high returns on capital, with limited exposure to intrinsic risk we can’t control. 
  • Strong Balance Sheets. 
  • Don’t need access to capital to survive. 
  • Excellent Management. 
  • Good Governance. 
  • Pershing Square Capital Management.

– Bill Ackman

In conclusion for today’s post, it’s very sensible to believe that if you adhere to and strictly follow these basic principles while investing you will be in great shape. If you go back in time and look at the trades or positions Bill and his team have made that failed to perform, the principles were not followed. And this has left them exposed. So if you look at everything mentioned above and read the Intelligent Investor or even Bill’s friend Seth Klarman’s book “Margin of Safety“. You will be well on your way to outperforming average traders with the right long term horizon.

One final thought: Warren Buffett likes to remind us as Value Investors to Invest into people. This means you must look at the Person or Management your investing into. Their Character, life achievements, and the culture they have built within their company. They must have integrity and honor and leadership. And when we stop to think about all these qualities? They add up! And that is why I have personally always been “ALL-IN with Bill and the Team at Pershing Square.”

Thank you for reading and I do wish you all Success in your steps learning about Investing.
Godspeed

JS

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Business Articles, Mergers and Acquisitions

Does a increase in Money supply mean Businesses are ripe for consolidation?

I received a question directly from the awesome searching entrepreneurs on Google Search today, So its with great privilege I get to share, explain, and answer this fragmented question to help all the future professional Entrepreneurs, Bankers, Accountants, and Corporate Attorneys out there. At the risk of sounding insensitive this question is slightly off base. So let’s dissect the elements and answer some facts.

“Who controls the United States Money Supply?”

The United States Treasury manages all of the money coming into the government and paid out by it. The Federal Reserve’s primary responsibility is to keep the economy stable by managing the supply of money in circulation. The Department of the Treasury manages federal spending.

So since we go this out of the way. Let’s move on to another question that creates value. Natuarlly we are going to want to ask the Question, “What makes the money valuable in business?”

“What makes the Money Supply valuable in Business.”

The value of any good is determined by its supply and demand and the supply and demand for other goods in the economy. A price for any good is the amount of money it takes to get that good. Inflation occurs when the price of goods increases—in other words when money becomes less valuable relative to those other goods.

If you have never watched the 2007 Business Movie that won all kinds of awards please watch this evil cruel film. It tells a disturbing story about a Oil Magnate mad man willing to go extreme lengths to use, abuse, and use dishonesty measures in business strategy in California in the early 1900’s.

There will be Blood “MOVIE”

“How does money get it’s value?”

The value of money is determined by the demand for it, just like the value of goods and services.

Business Landscape & Business Environment

Take a look at the volatility of the current Business market? It’s constantly changing second by second. It’s been my experience that in order to really look at company’s worth an acquisition development effort you must look at the long term future. Several questions come to mind. “Is the company easy and simple to understand?” “Does the business have a bright future because of the products it sells?”

Warren Buffett is always sharing that the business he looks for are the products and companies we love like Coca Cola. It’s the most recognizable brand in the world. And its future is certainly guaranteed to dominate most beverage shelves in nearly all stores and restaurants. So we can be pretty certain that investing in Coca Cola will be fruitful for investors. Coke is always looking at competition and alway’s buying up the best performing brands. If you did not catch the Coca Cola Acquisition of Body Armor last October? Please read about this Acquisition here. I mention this because I was contacted by a International Business News TV Station in Asia to comment on the transaction.

Acquisition Strategy in the Market

I would love to share a interesting view from the one and Only Mr. Bill Ackman who is the CEO and Founder of New York City powerhouse Activist Investment Firm Pershing Square Capital. At the expense of sounding like a Fanboy of Bill’s investment career? Which I am by the way. Bill personally is a sincere and just all around great guy. I really look up to his career as an example of where I am headed. He too was a Entrepreneur with a really tough road filled with hardship, adversity and impossible rejection. So I take comfort in his story that I am where I need to be.

This may sound ridiculous and surprising to some people who read this. But I am good with criticism I will receive sharing this next bit. Interestingly I will be going fly fishing with him sometime in the near future. But that is another story for another time. Let’s get back to business.

Research The Market For Acquisition Target Opportunities

Bill always said that when a downturn in the Market happens. He and his team of Analysts and researchers at Pershing look for opportunities by looking at Companies stock price that are trading for values lower than it should be. Meaning its undervalued stock price is an opportunity.

Activist Investing Strategy

Bill and his team shocked the Investment world during a market downturn when they made a trade off four hours of research making the Investment Fund Four Billion dollars in profit. Here is the short story.

If Wachovia wealth management company was trading at $1.84 and we look at the annual reports and the Debt on the books, and all the financials during a Due Diligence research session? And we decide the company is undervalued from the free cash flow and then look at the Stock price? We know there is opportunity for profit on this trade.

In doing this we look at the stock price and over all company valuation and decide is the company undervalued? Bill Ackman and his team mate Mick made a trade after 4 hours of research. And bought the Stock at $1.84 and later sold at around $9-$10 dollars a share. They bought 42 percent of the Company stock volume over 4 days. And made 4 billion dollars in profit just days after. Anyways all things considered? Bill’s Pershing Square Investment Fund made out like Bandits into the night. LOL Just incredible story.

Acquisition Consolidation

Before we move on? We must define Consolidation in Business Acquisition strategy? Consolidation in the most simplest of terms? “Is when a entity or a group of Investors Buys one Holding company, then buys other smaller companies or its competitive companies and folds these companies into it’s portfolio of companies creating value plus synergistic dominance in the selected industry.”

Professional Advisory Services with a proven track record to keep you safe during Acquisitions

I sincerely hope this complex post has given you a huge bang for your buck by clicking on my blog post on Google Search? This took me some time to write and rewrite. I won’t be winning any awards with my business blog. But at least I am able to share some basics in finance, business strategy, M&A and Entrepreneurship. If you would like to personally pick my brain and save time and weeks of research time? And if your a Senior Executive who would like a value based second opinion before accepting someones opinion you don’t value or trust? Myself and my team of Professional Advisors would be happy to Schedule a sit down and learn more about your mission.

If your team decides you would like to work with us? We can do the heavy lifting for you. We are also professionals for Executives and Business owners who require sensitive private secure services to protect all your teams professional reputations, leadership positions, and keep your Shareholders happy with your decisions and Job performance. My partners have built and operate company’s you see in the Wall Street Journal. I am lucky to have such wonderful mentors and partner advisors. And they can be yours as well.

Let’s Work Together

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