Parmeet Sangha on LinkedIn: “Mistakes are the portals of discovery" - The ECB is the Central Bank that… (2024)

Jensen Huang has described the founding of NVIDIA as a company with a “market challenge, a technology challenge, and an ecosystem challenge with approximately 0% chance of success,” adding that he would not have funded NVIDIA during the early days. Eight years after Nvidia was hatched in Denny's, the company earned a spot in the S&P 500.Today, they reported numbers (👇🏼) that have never been seen in the history of capitalism; the stock is up 6% after hours despite being up 97% YTD, and with a claim that “the next industrial revolution has begun”. Just looking at the jump in Data Centre revenues boggles my mind. #Nvidia #JensenHuang #Markets #Stocks

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One of the key takeaways for me during the first year of my MBA came from Prof. Mark McNeilly’s class called “Leading in the Middle”. It’s simple: Doing good work is necessary for success but insufficient. Showing your work (“Tooting your own horn” to an extent) makes your contributions sufficient to rise in Corporate America.Now, there are two problems with internalising this for me:1. Asian cultures like India hold humility in high regard, and most people will find it difficult to take credit. This is the meritocracy trap - “we deserve better because we’re the best at what we do”. 2. Indians find it incredibly hard to “Just Ask” regarding opportunities for growth or better pay or WLB - “Aren’t our managers supposed to be these all-knowing personas that figure out the efficient use of resources?”This is what I believe Steve Jobs is trying to say here: There are tremendous opportunities out there that no one is pursuing because people believe that:1. These opportunities should find them OR 2. They just haven’t dared to ask. TLDR: The answer is always no unless you ask.

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Gamestop is up 70% today because of this image on this tweet: https://lnkd.in/e-p2iNqeDoes it make sense? No. Is this the magic of Capital Markets? Yes. The YOLO, NGMI, and “Diamond Hands” crowd is back. My recommendation for the uninitiated: KYS or “Keep Yourself Safe”.

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I was in Omaha over the weekend attending Berkshire’s Shareholder Meeting with a few of my MBA friends, and I can truly say that it was a surreal experience. Warren and Charlie are monumental figures, both as highly successful businessmen and as investors, who have created a legacy of success over decades and whose thought-process has inspired millions in their own personal investments. Everyone in attendance missed Charlie and his quirky comments, and the Berkshire Movie at the start of the meeting highlighting his life and work received a loud and long standing ovation. It was a pleasure to be in the company of such stalwarts and a crowd that had made their way to the city of Omaha from all across the world. As someone with a passion for investing, portfolio management, corporate finance, and business in general - this was truly a once in a lifetime opportunity to learn from the best. I highly recommend it to everyone who has a passion for investments, has read the Intelligent Investor, and wants to experience the magic of the Oracle of Omaha. Thanks for a fantastic weekend:Stokeley Griffin, CFA, CAIA Cameron Goodman Jake Melman-Rogers #Omaha #BerkshireHathaway #BerkshireShareholdersMeeting

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I had talked about two key challenges facing #Apple in this previous section post: Regulatory Risk and Market Saturation. We’ve had major developments on both those fronts. 1️⃣ The US Department of Justice has filed a case against Apple for violating antitrust laws. More specifically, the case revolves around how Apple has used its locked-down iPhone ecosystem to build a monopoly.More: https://lnkd.in/eQVnthYj2️⃣ Apple's smartphone shipments dropped about 10% in the first quarter of 2024, hurt by intensifying competition by Android smartphone makers aiming for the top spot, data from research firm IDC showed on Sunday.https://lnkd.in/eUMWKj2rAnother thing of note has been the lack of Apple being mentioned in all the AI headlines. For a company that prides itself on innovation, is this a strategic play to see where the trend goes or are they genuinely behind in development. This headline last month was certainly concerning:Apple in talks to let Google's Gemini power iPhone AI featureshttps://lnkd.in/eNXZpv5dSince this remains a developing story for 2024, any thoughts or comments are appreciated.

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Jensen Huang, CEO of NVIDIA, recently spoke at the Stanford Institute for Economic Policy Research. Here are some of his quotes:🗣️ “People with very high expectations have very low resilience, and unfortunately, resilience matters in success.”🗣️ “Greatness is not just about intelligence. It comes from character, and character is not formed merely by being smart; it's shaped by experiencing and overcoming suffering.”🗣️ “For all of you Stanford students, I wish upon you ample doses of pain and suffering."Now suffering as the basis for growth isn’t a new thought but it is a deeply uncomfortable truth that needs reinforcing by highly successful people such as Huang. Here are some other quotes talking about this:👉🏼 Dostoevsky: "Pain and suffering are always inevitable for a large intelligence and a deep heart. The really great men must, I think, have great sadness on earth."👉🏼 Nietzsche: "To live is to suffer, to survive is to find some meaning in the suffering."👉🏼 Khalil Gibran: “Out of suffering have emerged the strongest souls; the most massive characters are seared with scars.”As we all struggle in our professional and personal lives, I believe wholeheartedly that progress is found through pain and that things have a magical way of working out. And it is always worthwhile to remember that if you haven’t found the destination, you might just have a little bit longer to go. Article: https://lnkd.in/eTUVNSkP

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Is #Apple past its peak?What has Apple achieved in the last five years?👍 Apple has consistently updated its flagship products and expanded its product lines, introducing new products like the AirPods Max and the Apple Watch SE.👍 Apple has significantly grown its services division, launching new services such as Apple TV+, Apple Arcade, Apple News+, and Apple Fitness+. These services complement existing ones, contributing to a robust ecosystem that drives recurring revenue.👍 Apple's financial performance has been robust and consistent revenue growth across its product and service segments. Apple's annual revenue grew significantly from 2019 to 2022 before a slight dip in 2023. Apple has continued to be one of the most valuable companies globally.👍 Apple's investment in R&D has fueled innovation across its hardware, software, and services. This includes advancements in processor technology with the introduction of the Apple Silicon M series chips, which significantly improve performance and energy efficiency in Macs.What would keep me up at night as an Apple Shareholder?👎 Regulatory Challenges and Legal Risks: Apple faces ongoing regulatory scrutiny in multiple jurisdictions over issues, including antitrust concerns, tax policies, and privacy practices. Regulation changes or adverse legal rulings could impact Apple's business practices, particularly concerning the App Store and its digital services. The latest example: Apple fined €1.8bn for breaking EU law over music streaming (https://on.ft.com/4397zcP)👎 Market Saturation in Key Segments: Some of Apple's key markets, especially its flagship iPhone, are reaching saturation points, making user growth more challenging. This saturation increases the importance of retaining current users and finding new revenue streams. A significant portion of Apple's revenue comes from a limited number of products, particularly the iPhone. The same is true for its most essential services segment, which has seen the highest growth in the past five years.➡ More than 2 billion Apple-made devices (mostly iPhones) are currently used. That's not the whole world, but it is a sizable chunk of the total addressable market.➡ People are holding onto their existing Apple-made devices for longer, crimping demand for upgrade purchases. Analysts with Morgan Stanley estimate the average iPhone is now a record-breaking 4.4 years old.➡ iOS users spend an average of around $44 per year on services that make more use of their Apple-made devices. It's tough to see them spending much more on this front than they already do.2024 feels like a crucial year for Apple:🚗 Apple car as a project has already been scrapped🤖 The AI revolution is here, and Apple hasn't joined the bandwagon⚖ Regulatory hurdles in the US and EU are likely to grow📱 Viability of VisionPro as a mainstream product will be tested.Enjoy this Dall-E image until we get a definitive answer to this question.

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From the Article: "In 2023, Indian investors traded 85 billion options contracts, more than anywhere else in the world. The country has topped the charts since 2019, when it first overtook the US in the volume of annual trades...Retail investors make up 35% of options trades... The average time an Indian trader holds an option is less than 30 minutes... 90% of active retail traders lose money trading options and other derivative contracts."From my experience, having spent four years as a Professional Trader in Futures and Options, this is a mind-boggling statistic. Here are three of the reasons options are much harder to trade than typical stocks:➡ Complexity: Options can be complex financial instruments. Understanding their value and how they react to changes in market conditions (like changes in the underlying asset's price, time decay, and volatility) requires a good deal of knowledge and experience.➡ Leverage: Options provide leverage, meaning that a relatively small movement in the underlying asset's price can lead to a disproportionately large loss or gain.➡ Time Decay: Options are "wasting" assets, which means they lose value over time. As the expiration date approaches, the time value component of an option's price decreases, a process known as "theta decay."Now, if you tell me that in a country where only 3% of households regularly invest in the Equity Markets, everyone understands what they are doing when it comes to trading securities - let alone options - I would be highly sceptical of your reasoning.Markets are a zero-sum game. Retail Investors are at a significant disadvantage to Institutional Investors in Markets such as India, where the Liquidity isn't as deep as in the US, and the Information Asymmetry is very high. Holding a trade for 30 minutes is pure speculation - there is no other way to describe it. And if such gambling is what such Indian Traders are after, I understand that Las Vegas offers the same thrill and entertainment.https://lnkd.in/eyQyJHBz

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#FOMC After a long while, there was genuine interest in what the FOMC and Powell had to say today, especially because this was their "Rates have peaked - here come the cuts" moment. Powell sounded non-committal to everything the market expects from them this year: 4-5 cuts, slower balance sheet roll-off, and pulling off a soft landing that has evaded the Fed for decades. Here's the stand-out statement from the FOMC Presser:"I don't think it's likely that the committee will reach a level of confidence by the time of the March meeting to identify that March is the time to do that (rate cut)."So what does this mean in layman's speech? He wants to push back against the aggressive rate-cut pricing (similar to Waller's speech a few weeks ago) but also wants to keep the door open should things evolve differently. Why will they skip March, and why is May the likely first cut?1. Data hasn't evolved for them to feel confident: GDP growth has been very robust, CPI Core is still closer to 3% than 2%, and NFP reports are running 1.5-2.5x the usual 100k average.2. MonPol Concepts are Guidelines: While the Taylor rule says they should have started in the opposite direction by now, these archaic methods of predicting MonPol have gone out the window in the last few years. Taylor Rule, along with the Beveridge curve and the Phillips curve, are more guidelines in today's world than something the Fed takes into consideration. They (FOMC) are humans, driven by emotion and sentiment (or, as Gen Z would say, Vibes), and quantitative assessments only go so far in a rapidly evolving world where two wars are raging and major trade routes are under attack.March is sure to bring a new spring for the way the Fed looks at setting the tone for the rest of the year.#MonetaryPolicy #FederalReserve

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