Stock selection rather than market timing. The process involves identifying stocks within one’s competence circle, analyzing qualitative criteria (competitive advantages, strong balance sheets, high return on capital, shareholder-friendly management), determining valuations, and establishing appropriate margins of safety.

Buying ‘AI losers’ — stocks ignored because they aren’t AI beneficiaries.

The opposite of value is not growth, but anti-value.

Barriers to entry in this industry are very significant. In addition to negotiating thousands of contracts with data providers and gaining access to several hundred thousands of data sites, an entrant would have to overcome investments in intellectual property.

If you look at a company’s balance sheet, book value is the difference between the company’s assets and its liabilities — it is the company’s equity.

Book value in today’s economy is even less relevant for most companies. The value that you don’t see on Apple’s balance sheet is that sparkle in Apple customers’ eyes when they use the company’s products. That sparkle is the intangible good that Apple created by building (often) revolutionary products.

Value investing doesn’t do as well when the punch bowl is spiked with euphoria and everyone only looks up. It is when the punch bowl is taken away and investors start looking down that value investing, or simply common sense, does well.

A bull market makes you feel smarter than you are, the same way a bear market makes you feel dumber than you are.

Buy and hold (never a great idea in any environment) absolutely must be replaced with buy and sell.

As my income went up, instead of buying myself things, I turned to buying time and experiences. It’s a trade-off.

Nvidia and the semiconductor sector are a classic capital-cycle story: demand creates too much supply, and a boom leads to a bust.

Apparent catalyst absence creates undervaluation. Wall Street’s short-term orientation causes undervalued stocks lacking near-term catalysts to get dumped.

A CEO’s responsibility is to create shareholder value. But a CEO’s job is to achieve that through earnings and increasing the moat around the increasing return on capital, growing business; not through stock manipulation.

To know my circle of competence, to know where I’m the strongest.

Complex systems are full of interdependencies — hard to detect — and nonlinear responses.

Covered call strategies (selling calls against owned stocks) make sense only when call compensation is adequate and investors aren’t forced to maintain overvalued stock positions long-term. Used correctly, options provide terrific hedging and conviction amplification.

What I call the Cowardly Lion market, whose occasional bursts of bravery lead to stock appreciation, but are ultimately overrun by fear that leads to a subsequent descent.

Cyclical bull markets teach us not to sell, while cyclical bear markets teach us not to buy. If you let the market tell you what to do, you have no process.

The stock market’s daily liquidity — stocks being priced continuously throughout the day — is both a feature and a bug. If you unintentionally let the market into your life, it will ruin you. The human mind is not built for it; it interprets frequency and loudness as authority.

The productivity of software engineers will go up a lot. This is a deflationary force — and one that will displace a lot of jobs.