Regret minimization
Wealth linguistics
HITSERIES CAPITAL stands on “regret minimization theory”, minimizing loss function in asset allocating activities. Words of wisdom often inspire us towards right direction.
1
Non-Action is the Default Best Choice
Doing nothing is often better than doing something poorly. If you can’t consistently beat the market, index investing is the better choice. Most professional investors fail to outperform the index over time—research shows that over 95% of actively managed funds underperform the S&P 500 over a 20-year period.
2
Outperformance must justify the extra risk and effort.
If performance is uncertain, non-action is the default best choice. Even if an active investment outperforms, excessive risk could still make it a worse option than the index.
3
Non-Action rationale
A deep understanding of the rationale behind non-action is required to logically establish economic criteria for achieving outperformance above the benchmark. If you don’t have a clear edge (e.g., strict financial hurdle rate, deep domain expertise, strong connections, unique insights), then sticking with the index is statistically the better choice.
Veni, vidi, vici
Outperforming benchmark
A market shakeout is a phase in an industry or market where a large number of companies-especially weaker or inefficient ones-exit due to intense competition, financial strain, or external shocks like economic downturns. This leaves only the strongest, most adaptable, or well-capitalized players in the industry. Here is the clear stance to survive a natural market correction and beat benchmark.
1
Panic Investment
(Contrarian investment)
Timing:
When irrational fear drives asset prices below reasonable valuations. Panic investment.
2024 AI movement
2020 COVID crash, startup VC crash
2008 Financial Crisis
Rationale:
Be greedy when others are too fearful far below fair market value(FMV).
KPIs:
-Discounted cash flow > benchmark
-Margin of safety > 50%
-Downside protection
-law of scale(Top line growth)
-Economies of scale(Operating leverage)
2
Deep Value Investment
(Event driven investment)
Timing:
When an asset is trading at a deep discount to intrinsic value due to several reasons. Buying a company at 50% below book value when fundamentals remain strong.
Rationale:
Due to some event, markets can misprice assets, but over time, prices tend to revert to fair market value(FMV).
KPIs:
-Discounted cash flow > benchmark
-Margin of safety > 50%
-Downside protection
-law of scale(Top line growth)
-Economies of scale(Operating leverage)
3
Distressed Assets Investment
(Growth investment)
Timing:
When private investments offer significantly higher expected returns than public markets.
Rationale:
A distressed company with strong fundamentals but temporary liquidity issues. A startup in a high-growth sector with some deep issue that cannot be solved by current shareholders but can easily be solved by us.
KPIs:
-Discounted cash flow > benchmark
-Margin of safety > 50%
-Downside protection
-law of scale(Top line growth)
-Economies of scale(Operating leverage)
HITSERIES®CAPITAL
HITSERIES®CAPITAL is the rainmaker in growing industries. We are investing client magnet leadership, carefully based on history of mathematics, physics, computing and economics. GAAS concept of HITSERIES CAPITAL is continuously finding the lowest energy way to express the process of how empire, dynasty and supernation will be made, from investment to return, eventually finding connection between physics and wealth. Curious about how the universe complexity works and how a new scientific invention could restructure truth itself proving potential energy by materializing transforming power of society, humanity, economics.
Every randomness in the universe have truth theorem, which is designed by a combination of symmetries and symmetry breaking. Whereas, the principle of least action in physics states that the path taken by a system between two points in space and time is the one that minimizes the action. Building the least action models provoke the sense of beauty in various industries: Cosmology, climate, energy generation/grid , logistics, material science, chemistry, biology, social statistics, smart city architect, foods&agriculture, luxury garments&jewelry, travel, art&entertainment
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