If there is one thing that we really dislike is overpromising titles. And here we find ourselves today writing a title that may sound the most overprimising you have ever read this year … yet, it is a very honest though ambitious piece. Above all, it is real, full of integrity, and based on a structured method. It is primarily based on leveraging the asymmetric dynamics in investing as per Tsaklanos his 1/99 Investing Principles. Read how to turn 10k into 1 million USD in 7 years with InvestingHaven’s opportunity investing strategy and investing tips.
InvestingHaven’s research team is characterized by its authenticity and transparency.
We publish many forecasts that are spot-on, and there are some that we miss. We are open and transparant when we miss one.
If anything, we absolutely cannot stand overpromising analysts and articles. All writings must be based on good faith, and with high ethics in mind.
With all this in mind we are on record opening our method to turn 10k into 1 million USD in a period of 7 years.
Note that this goes against the get-rich-quick idea. We stick to the get-rich-not-so-quick mantra.
In the end we want a solid method to grow our capital significantly. The readings and tips about billionaires, here or here, are pretty worthless. We are looking for something differently: high reward calculated risk based on a solid and repeatable method.
Turn 10k Into 1 Million In 7 Years: The Principles
As said in our 100 investing tips for long term investors it is all about the long term focus combined with the care and dedication.
In the section “consider it your business” we wrote the following 3 tips:
Investing tip: Discipline is one of the most important success factors. Only very disciplined investors are able to repeat successes, and outpace profits versus losses.
Investing tip: A method for picking investments with entry and exit criteria as part of strict risk management and time management is crucial.
Investing tip: By combining the previous 2 investing tips we conclude that having a method in place which you respect in a very disciplined way, and continuously improve based on learnings and mistakes, is a key success factor! This is very similar to running a business. Each and every business that runs successfully has a method that is followed strictly, allows for mistakes but learns from the continuously, and only expands in a controlled way. Investing is no different!
Moreover, and equally important, if not more importantly, the asymmetric effects of investing is the overarching principle that we want to leverage as an opportunity.
As per Tsaklanos his 1/99 Investing Principles, a variant on Pareto his 80/20 rule but then applied to investing, there is just 1% of markets that crush all other markets (99%). It is this 1% of markets that bring mega returns.
Turn 10k Into 1 Million In 7 Years: The Method
Given the principles we outlined above is there a method that can turn 10k into 1 million USD in a period of time, say 7 years?
Yes there is.
This is the specifics of the method which assumes picking winners based on thorough research. It also includes the fact that 1 out of 3 picks will be a loser for which losses need to be cut short!
The method is based on 3 picks per year of which 2 can be made simultaneously. So the capital is split among 2 investments at the same point in time. Also, every investment is 50% of the total capital.
- Investment 1 yields +30% (sell as of the moment 30% is reached)
- Investment 2 is a loss of -30% (losses are cut short at max 30%)
- Investment 3 yields +100% (capital doubles)
The major benefit of this method is that it is all based on clear exit points. One of the great pitfalls for all investors, including ourselves, is the inability to sell, for sure when prices rise. There is always this feeling to wait just a little bit longer as some higher prices may be coming. That’s where it often goes wrong.
Does this resonate?
One might ask: how reasonable is it to have every year one winner of 100%?
It is very reasonable!
Look at the following list of winners in the last decade:
- 2010: silver price
- 2011: gold price
- 2012: biotech stocks
- 2013: 3D printing stocks
- 2013: solar energy stocks
- 2014: China’s stock market
- 2015: crude oil crash (short opportunity)
- 2016: sugar price and base metals
- 2016: banking stocks
- 2017: Bitcoin and cryptocurrencies
- 2017: semiconductor stocks
- 2018: palladium price
Not impossible to catch most, if not all of them.
This requires thorough research and focus on catching winners (as opposed to diversification), and that’s what it’s all about!
Turn 10k Into 1 Million In 7 Years: The Math
So let’s do the math, starting with 10k.
- Trade 1 goes from 5k to 6.5k (30% gain)
- Trade 2 goes from 5k to 3.5k (30% loss)
- Trade 3 doubles from 5k to 10k
At the end of year 1 the initial capital went from 10k to 20k taking into account 1 losing trade!
If the same happens in subsequent years we see the power of compound returns kicking in.
It becomes tricky from year 5 to year 6. That’s when the capital would go from 320k to 640k. Needless to say, investing half of it (320k) into one investment is rather tricky, for sure if going after a small cap stock that has the potential to double. It is too challenging.
That’s why this model needs smaller amounts as investments in the last 2 years.
Turn 10k Into 1 Million In 7 Years: Any Interest?
InvestingHaven’s team is keen on applying to strategy which by the way is already implemented and working pretty well so far.
Anyone interested in getting insights on the trades and the research? Please drop us a note, we want to get a feeling of the interest in this strategy and the research behind it before opening it up.
Please use one of the following 2 email addresses: investinghaven at gmail dot com, taki dot tsaklanos at gmail dot com.
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