Design of solids is the process of coming up with a suitable solid shape that later determines our actions in the market. To make the design process quicker and easier, we normally start from a particular shape that we call foundational shape.
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Over-investing can be a big problem. Greed and influence of the system facilitate over-investing to happen. Solution is in the two imperatives: Solids must be fully funded and Leverage or margin shall not be used.
Before you start applying the strategy within your investing account and with real capital, it is a good idea to recap a few things and go through a check-list to confirm you have everything in place for a successful start.
Design process entails shaping the way we respond to price changes in the market. The most common shape that gives the best returns in most circumstances is the shape that resembles a pyramid.
Importance of mindset in investing. Keep the balance between investing and other activities in your life. Familiarizing with the strategy. Keeping on the right track and progressing through stages.
Bank accounts are the origin of investing capital. We need to figure out the amount of liquid capital available for investing in equities. Note on valuation of illiquid capital. Planning 101 – In SWS utmost consideration is given to planning stage.
Diversification is an important concept in investing. Diversification solves the problem of lack of deep investing knowledge. Everyone has opportunity (and need) to invest. Diversification is just another tool that you can apply in your investing. We favor diversification.
Risk is a probability that something can happen. Risk implies unwanted outcome. Risk represents probability of losing something. Investment risk is a chance of losing money. SWS is quite successful in minimizing investment risks especially in context of achieving solid investing returns.
SWS is very flexible in terms of level of activity. Also called “frequency of activity” can fall within a range of milliseconds up to many years. The more active we are, the more profitable we get. Capital is important factor that determines maximum level of activity. Appropriate design can be used to make further tweaks.