1. Introduction to BLAST Framework: The video features Steve Symington discussing the Blast Framework, a unique stock research and selection strategy he developed.
2. Steve Symington's Background: Steve Symington shares his extensive experience, having written over 8,000 articles for the platform and managed real money portfolios, including an artificial intelligence portfolio.
3. Components of the Blast Investment Strategy (BLAST):
   • B - Big Impact: Focus on companies making a significant positive difference in the world.
   • L - Large Market: Emphasis on companies with large total addressable markets.
   • A - Adaptable Management: Preference for management teams capable of pivoting operations as needed.
   • S - Sustainable Growth: Seeking companies with a realistic plan for profitability without compromising vision and values.
   • T - Transparent Operation: Prioritizing businesses that are transparent and act ethically with stakeholders.
4. Investment Process and Approach:
   • Symington emphasizes a continuous learning process, reading extensively about businesses, and studying their ability to align with the Blast Investing Framework.
   • He follows a patient approach to portfolio building, starting small and gradually increasing positions over time.
   • The "buy and homework" concept is highlighted, stressing the importance of ongoing research and engagement with invested stocks.
5. 2024 Investment Advice and Market Outlook:
   • Symington advises investors to tune out noise, especially during election years, and emphasizes the potential opportunities in small and midcap growth stocks that may not have revisited their highs.
   • With the Federal Reserve potentially changing directions, he suggests stock pickers might find opportunities as markets adjust.
   • Symington can be found on Twitter for those interested in following and engaging with him.

Note: The transcription includes a conversation about specific stocks and market conditions, and the information provided is based on the content available in the transcript. It's essential for investors to conduct their research and due diligence before making any investment decisions.

Watch the full episode on YouTube:

Now, let's go into more detail and discuss the risks our good friends at BlackRock have identified for their own Bitcoin ETF, ticker IBIT. There are several pages of risks that I went through, and I will summarize them in three groups:

Volatility: the first risk is volatility. Last week, I shared a post on how volatility is not equal to risk. Risk is your response to volatility. If you sell when the prices are down because you can't tolerate seeing red on your portfolio, you turn volatility into risk. 
​
It's no surprise to anyone that Bitcoin is volatile. Bitcoin's price goes up and down quite rapidly. In the middle of last October, Bitcoin was about $28,000 per coin. Three months later, in the middle of January, the price nearly doubled to above $40,000. In November 2021, you could have bought Bitcoin for almost 70,000, and only three years ago in 2020, the coin was yours for about $4,000. Bitcoin is certainly a volatile asset, and if you know yourself and can't tolerate the extreme movements, then Bitcoin ETF is very risky for you. Indeed, since the launch of the ETF, it is already down 13% from the starting price of $27.51.


​The next category of risk is operational risks. BlackRock brings up the fact that Bitcoin has been around only for 15 years and is run by volunteers. By all definitions, it is still a startup run by people who chose to work on it. If something goes wrong with the Bitcoin code, are we sure and have we seen enough operational history to conclude that the network stays secure? No one knows, really. 

Bitcoin isn't a company. It doesn't have a CEO whose leadership quality you can assess in times of crisis. According to the Gemini website, "Bitcoin is not controlled by any single group or person. Instead, it is governed by multiple stakeholders — including developers, miners, and users. Developers write the code that makes Bitcoin run; miners validate transactions, and users put the software to work by trading, transacting, holding, and more. It is a self-governing, software-enabled 15-year-old experiment. If these networks of individuals and companies decide not to participate, or developers who run the network lose the financial resources to maintain their operations, the system will fall apart. No central entity runs the operation that we can assess its quality. That's a risk. 

The so-called Bitcoin miners are individuals or companies with lots of computer processing power that record Bitcoin transactions. They do the recording work in exchange for Bitcoin as the reward. Let's say the price of Bitcoin goes so much down that it is not economically viable to record that transaction. If that happens, Bitcoin is not an entity that can go to the bank and get a loan. The integrity of the network falls apart if it is not economically viable to mine bitcoins and record transactions. In all likelihood, there will always be a miner willing to temporarily accept loss so it can stay in business. After all, miners' financial livelihood depends on Bitcoin, but a major disruption to the entire Bitcoin network is not difficult to assume. It hasn't happened yet because Bitcoin hasn't been around long enough. That's a risk.

This leads to the last group of risks: ownership. How does Bitcoin software enhance and improve and who owns the future product roadmap? Bitcoin has a loose network of what's known as core developers. You can find them on Github, a platform for storing and managing software code. These core developers may get corrupted, may not agree on the direction, or undermine each others' work in extreme cases, or a whole myriad of human fallacies and pitiful behavior may take over the core developers' community. I don't know any of them. But history has shown humans are prone to mistakes, and core developers of Bitcoin are no exceptions. So far it has worked because everyone's monetary incentive is aligned to make the network work. At some point, it may not. Of course, consensus and voting mechanisms are coded into Bitcoin's software, but most of us are not technical enough to evaluate them. All we know is that it has worked for 15 years. But there is uncertainty risk for non-technical folks like you and me. 

It's also widely believed that a small number of individuals own the majority of Bitcoin. These are wallets or a set of wallets that have owned and hold a big portion of the coin. We don't know who they are and what they are up to. If things go wrong, these owners are incentivized to pay off enough core developers to act on their behalf. After all, as late Charlie Munger used to say, if you want to understand what people do, look into their incentives. Most Bitcoin owners will act in their own interest, especially if something goes wrong. 

There are more risks in the BlackRock IBIT ETF document, but those three categories cover them well enough. 

I know you can look at your portfolio in whatever brokerage app you use to invest and know your investment return. However, there are a few problems with those portfolio returns. 

Most brokerage applications do not keep and count your sold positions in your total return if you withdraw the money. Once you sell a position and withdraw the money, winner or loser, it will no longer include that transaction in your total return. Moreover, if you have more than one brokerage, with your retirement account in one app and your stock investment in several apps such as Robinhood, Webull, or others, getting your real investment return over the years is almost impossible.

If you do not track your buy and sell decisions in a central place, outside your brokerage apps, it is very possible that you are losing money in the the market and don't even know it. 

As they say, what gets measured gets managed. If you don't measure your real return including everything you've sold to take profit off or panic sold a position because the price was going down, you never know what your actual rate of return is over the entire year and across several years. You can't manage your portfolio effectively.

In 2024, before starting a new portfolio or adding and removing things to your current portfolio, create a central place to put all your buy and sell decisions and calculate your real return, including what you've sold. 

Sticking to this process year-over-year is important too because you may lose money in one year, but you want to ensure you can recoup the losses in the next few years. You want to set the foundation correctly to calculate your total return across all your investments and over the years. 

How to do this? Start a Google Sheet, and record it every time you decide to buy or sell. There are obviously apps, too. For example, my company, Stock Card, has a portfolio feature built exactly for that purpose; it's free, and I use it myself, but it requires you to enter your trades manually. You can also use portfolio tracker apps like Sharesight or Kubera and pay a small fee to have everything in one place. Without knowing what you are doing, there is really no way to plan to improve things. 

​Some of you know and follow my real-money portfolio on Stock Card. Judging by an average return of roughly 400% for all of my investment decisions since 2014, it's a good portfolio, beating the S&P 500 average return nicely in the same period. I am also emotionally attached to this portfolio because I've used it to fund building our company, Stock Card, and pay the down payment for our house. So, overall, it's not a bad portfolio. But, it has started to stress me out to the point that I have stopped investing in individual stocks in the portfolio for a while and just kept up with our automated index investing through our 401K account that isn't included in my portfolio on Stock Card. Why does my portfolio stress me? There are over 100 stocks and ETFs in it. I find myself wide awake at night thinking about some of the stocks and ETFs in the portfolio that I haven't dug into for a long time, and I spend a lot of time researching stocks and ETFs every day because of my work. 

The more stocks and ETFs you have in your portfolio, the more time you need to track them. Even a technology-savvy individual who uses good research platforms to do research better and faster can't keep up with 100s of stocks and ETFs. 

Some of you have heard about big-name investors like Peter Lynch who had more than a thousand stocks in his market-beating Magellan fund for over a decade. Honestly, that was my model back in 2014, but Peter had a team of analysts supporting him. Recently, in a book written by Peter Lynch's prodigy, Joel Tillinghast, I learned Peter was maniacal about getting his research done through his team of analysts. So, the amount of stuff in your portfolio has to be proportionate to the time it takes to research and keep up with them. Even if you are a long-term holder like me, you have to check in with companies in your portfolio roughly once a year to ensure there is no fraud in the worst-case scenario or whether there are opportunities to add more in the best-case scenario. 

Applying this step is rather easy. Do a quick mental math and see how much time you have each month to research stocks, and divide that by the average time you allocate to research a stock or an ETF to see how many stocks or ETFs you can research per month. Multiply that by 12 for 12 months, and this number is a good indication of how many stocks and funds you should hold in your portfolio.  

Let's do the math for me. 

I have about 2 hours per day to research stocks and ETFs, which gives me about 40 hours per month allocated to stock market research. Remember that researching is part of my work if that seems a lot. Then, historically, I need about 5 hours of high-quality research to make a buy or sell decision. So, my 40 hours per month gives me about eight stocks to research each month, and that's about 100 stocks researched properly each year, 8X12. But then, you don't buy or sell every stock you research. Even if I invest in 20% of the stocks and ETFs I research, my portfolio can't be more than 20 stocks.

You should do a similar rough calculation to figure out how many stocks you must buy or sell each year. The more time you have available to research and check in with the holdings in your portfolio roughly once a year the more stocks and ETFs you can have in your portfolio.