A trail starting from an interview with one of Stan Druckenmiller’s proteges. I’m not sure if Beeneet Kothari is actually Druckenmiller’s protege (it just seems like a loaded term), but there is a specific moment in the interview that caught my attention.

It is around the ~8min mark where Kothari shares what he took away from Druck’s teachings and implemented to his own investing process. It’s simply that 80% of your returns will come from the few best ideas, making the 15th and 16th ones inconsequential.

As I write it, I get that it doesn’t seem so ‘a-ha’. Maybe it caught my attention because I’m anchored to the “80%” because I’m currently reading the 80/20 Principle. But I really liked how Kothari elaborated on it by saying the focus is on the big things. Not the details.

It’s not about whether to make a position 9% or 10% in a portfolio. It’s about whether you should be in the investment or not. If it doesn’t work, you have to get out ASAP regardless of position size. If it works, you’ll never have bet enough.

Now, there can be many…nuances to this situation. At least that’s what I thought. Because how do you know if something is working or isn’t? If the market doesn’t respond to your vision of the future do you wait or are you wrong?

This is probably where you’d rely on the business facts to provide clarity over time. And this is probably where the bet should be so obvious that it will be rather clear to you. Kind of like the 1-foot hurdle Buffett says to aim for instead of the 6-foot ones.

After breezing through another few interviews with the Druck himself, I ended up reverting back to the transcript of his I took notes on for a past podcast episode. Then, I read the full talk again (I recommend you do as well if you’re interested in the man who returned 30% annually for 30 years).

There is a line in the talk that I didn’t fully understand the first time I read it: “Bulls make money, bears make money, pigs get slaughtered. I’m here to tell you I was a pig.”

And now I feel like I do.

There’s another popular investing saying “No one ever got broke taking profits.” To that one would then reply “yeah… and they never got wealthy either.” Because to build wealth you need to compound and for something to compound you have to let it run. Run for a while.

And this seems in-line with Druck’s pig. I think the pig is talking about greed. I was curious and looked it up. Seems I got the gist of it. The funny thing is that people think they are bulls or bears. In some ways they are implying they are able to time markets to know the cycle they are in. Which is a bunch of horseshit.

In some ways, the pig is the rational one because you bet massively on conviction to the idea you have. It’s a truly scary thing. To bet big. Most won’t in the name of some risk-adjusted return bullshit. I don’t think most people have any idea what they are even saying. Adjusted for what risk? Clairvoyance on the fate of the company?

Simply, you wait….and bet on conviction. If you’re wrong, then pull out. These are the big things that matter. It’s something I’ve been wrestling for a while.

The March 23rd drop was probably the most exciting time of this year. Not because I just gained a year the day before….I mean could you imagine how I felt to see my net worth tank some 15-20% the day after my birthday? Rough.

But since then, I made bets. Some doubled. A few 4x’d 5x’d and I sadly sold early on one that 8x’d. Tragically, many of these were small positions. My poor girlfriend could not understand why I was lamenting every time I got alerts saying my investments were up 10-20-30% on a day.

Mr. Market really knows which buttons to press to rile me up. On reflection, the mistakes were not going hard on the bets I had conviction on. Because yes, they were my best ideas. The one I sold too early one….it wasn’t my best idea and I honestly don’t think I would’ve had the conviction to hold to it all the way.

But I’m learning. Slowly.

After thinking heavily in my investing journal, I finally consolidated 80% of my capital to my best ideas. Naturally, these could change with new facts. But at least now, I won’t be mad about my best ideas performing well.

I guess I don’t care to be a bull or a bear. Just trying to be a pig….and who knew it would be so hard. In some ways, my youth in the markets seems to help with keeping steadfast with my views on the future given our present times.