Alchanati Campbell & Associates
Past, present, and future; the only time that we’re capable of knowing. They say you're supposed to learn from the past, live in the present, and plan for the future. But everybody is always looking forward to something. The present never satisfies us; it is always better one minute later or two minutes before. You keep wishing you were older until you finally realized its better to be young. The young want to be old and the old want to be young. Your mind is stuck six months in advance when you expect your diet and workout routine to payoff. But that’s only if you are actively working to better yourself in the present. Putting things off is the biggest waste of life: it snatches away each day as it comes and denies us the present by promising the future. The greatest obstacle to living is expectancy. So how do we live properly? The past is gone, and the future is impossible to predict. I can die tomorrow or live to 120. Let’s get to it:
Be present. Be 100% present in body and mind in everything you do. Do whatever you’re doing in the present moment well. Yes, our current beliefs depend on realizations experienced in the past, but we are in a constant change that requires adaptation and an open mind. Live every second like it's your last, but don’t lose value or meaning in those seconds. In order to benefit yourself and the universe, you must have a higher intention in mind beyond mere self-gratification. It doesn’t mean you’ve given up on the pleasures of life; you’ve replaced them with even greater pleasures. Your brain naturally rules over your heart. You might not be able to control your urges, but with your will-power, you can prevent the urges from ever affecting your behavior. Your actions, speech, and thoughts are under your complete control. Right now, you can achieve total self-mastery if you so desire. The key to this is focusing on the “now”. Don’t obsess over how bad you were in the past. The truth is that we live in the present, and right now, your focus should be getting the most out of each day you live in.
The Market. We are in a national emergency; do you feel it? Stocks surge on trade talks and consumer sentiment. Many are beginning to suspect the Administration and the Fed are purposely releasing statements to keep this market rally intact. When will they realize this will backfire in the end? A record 7 million Americans are 90 days+ behind on their auto loan payments (a million more people behind than during the financial crisis era and most are under 30 years old). US national debt tops $22 trillion. On a lighter note, the 30-year fixed mortgage rate fell since its November 2018 highs.
Value, quality, low volatility, momentum, and size. These 5 factors pose as the best factors to evaluate equities. When you create a valuation model for an equity, you evaluate the equity’s internal factors like profitability, debt management, liquidity, the capital structure, and the free cash flows, and then you use these metrics and their growth to forecast the future to see if this equity has “value” or “growth”. A big part of an equity’s valuation is how it compares to its competition. Is it leading the industry? Does its sales growth beat competition? Does it have a majority of the market share? When you are creating a portfolio of equities, the best factors to go off of are these 5. Value as in price-to-book ratio. Quality as in profitability and the degree of conservative investment. Low volatility as in the lowest volatility in sector, region and global betas. Momentum as in outpacing the market in growth. Size as in large-cap versus small-cap.
All of our problems are the same. You didn’t reach a goal? Don’t give up, try a different approach and remember the end result is less important than the journey it took you to get there. Somebody criticized you? You can’t please everybody. Learn from the criticism and don’t be afraid of it. You have financial troubles? If money was the purpose in life, inflation wouldn’t exist. Lack of money helps you decide on what matters and what doesn’t. You’re unhealthy? Quit feeling sick and do something about it. A relationship ended? Finding love is about understanding what love is not. You need relationships to end to find out what love really is.
The Alchanati Campbell and Associates Team
WHAT'S UP FRIDAY? is a weekly newsletter that will give you a summary of "What's up?" on Wall Street, in the US and around the World written by The Alchanati Campbell and Associates Team. What makes us unique is we focus on long-term knowledge; knowledge that will still be useful to you 10 years from now.