An A-Z reflection of 2020
December is always a reflective time for me. I like to try and be vulnerable about myself in this blog every year. I admit I'm a huge overthinker at times, but I try to write to voice all my thoughts down in a more coherent manner. I write also because I'm often not very good socially in person...
Anyways, I was inspired by a member ("Young George") in my Bible study group to do this exercise. He recapped a different moment of his life for each letter in the alphabet. I really liked the idea, which was better than the template 50 Qs I found from a random website last year.
What the "metaverse" could look like...
Anyways, this is my A-Z reflection of what has probably been one wild calendar year to remember, for me, but I'm sure for many others.
Antipodes. The hedge fund I work at, and where I focus a lot of my attention to. Like many others my age, this was the first time seeing a 30% rapid sell off in the market due to the coronavirus pandemic. I remember the anxiety I felt at the time during the sell off, but am glad I took advantage of the sell off when I look back in hindsight. The market has recovered incredibly. I often admit I was in the right place at the right time, given I cover US and EU software companies, which have certainly benefited trends like online shopping on Amazon, remote working for Microsoft, staying socially connected with Facebook, exercising at home with a Peloton, etc. I'm sure there are more examples you can think of. I've been very fortunate to work in a very hard working team and been inspired by all their work ethic to delivering investment performance for our investors.
Bitcoin. Two colleagues, Ray and Leo, convinced me to take the leap of faith into cryptocurrency, and I took the most liquid coin, which was Bitcoin with my sister. My simple thesis is that this is an asymmetric bet. We are seeing evidence of some large fund managers take a small % of assets in crypto like Bitcoin. Imagine if pension funds allocated even ~5% to crypto of the total portfolio. Some funds will add more and some less but assuming it averages out. The volume of absolute dollars flowing into Bitcoin would be in the order of hundreds of a few trillions of dollars. According to Ark Invest, in Bitcoin terms, that would imply an additional US$400-500k to the current ~US$20k Bitcoin price. That's a 20+ bagger. You only need to believe that allocation to crypto shifts to 5% over time. This is reminiscent in a lot of ways, to pension funds adding small % over time to alternative assets like property, private equity, etc. I am 50% sure it will get there (the other 50% assumes Bitcoin goes to zero), so the expected value is still a 10+ bagger in 5-10 years. That looks like a rational bet to me.
Connect Group. This started during COVID with our church, Macquarie Baptist Church. I've been blessed to be part of a group with Ken and Verdi, who have been solid men that have kept me accountable to my prayer time, and ultimate focus on God. We "zoomed" every Friday night (except on nights when we had home groups on Saturday nights).
Dear Santa Cafe. This cafe in Epping has easily served me 150+ coffees this year. Would recommend it to anybody looking for a cafe in Epping. The Korean owners are very kind, and the pricing is reasonable. Would recommend the mushroom toastie.
Exam for CFA program. Balancing my CFA L2 exam study and work at Antipodes was a very delicate thing, but I'm glad to have completed my exam last week. Would recommend my 3rd party provider, Mark Meldrum, who I have used for preparing for my L1 and L2 exams. Awaiting my result in late Jan 2021...
Foundation of Goodness. I continue to donate a regular sizable amount to this volunteering centre based in Sri Lanka. I volunteered there in July 2016 and met an excellent teacher, Saman. I regularly catch up on FB calls with Saman to learn how he is deploying the money. I briefly mention my time in Sri Lanka here. It was incredibly eye-opening, and a humbling experience. This year, donations have been tougher due to COVID and the consequent wallet tightening, but I have committed to my annual donation. My money goes to the IT centre, which helps train future rural kids around Seenigama with IT skills that ultimately make them productive for the Sri Lankan workforce. I am bullish on this lovely country longer term despite the short term political leadership question marks.
Godiva. Very thankful for my sister entrusting her capital with me and following through with a lot of my stock recommendations this year. This is despite some blow-ups that I take full responsibility for, like Avita Health, an FDA approved spray-on skin products business. Overall, however, I have been pleased with our positions to date and the returns they have holistically achieved. I am also inspired by her looking after her baby, Evelyn, who is now 3+ years old.
Homegroup. My church bible study group meets regularly almost every 2 weeks. I admit I haven't made some of the recent meetings due to my CFA exam study but I was glad I could still deliver my leaders a small Xmas gift as a token of appreciation for their hard work leading our group all these years. Robin and Annette are truly inspirational beings in hospitality.
IBM case study guest lecture at UNSW. Dr Leon and I have a relationship of respect which I am thankful for. He took over the PASS program for Accounting 1B right when I left, but I was glad I reached out to him still and he has invited me back every year to guest lecture in his International Financial Analysis course. This time I got to share my 2c on my pessimistic outlook with IBM, the enterprise technology business.
John and Glendy. My parents were on the Ruby Princess cruise that arrived back in March 2020, before we had that huge debacle in Sydney of daily COVID cases in the 200 range (FYI the passengers had no idea there was somebody with COVID, even when they were sent home). Thankfully, my parents ended up testing negative, but I recall my mum was fairly sick with flu-like symptoms on her return home. Their 2 friends were not so lucky and ended up in ICU at the hospital with COVID, but thankfully by the grace of God, survived, and are now healthy once again. My parents have been very supportive with my work (e.g. dad cooking me lunch/dinner, and mum dishwashing without me), and especially during my study time for my CFA exam. I owe them a lot of thanks.
"Knock them down" by Alex Ferro. This song is fire for getting hyped.
Lachlan, my mentee. I have been blessed with the opportunity at Alternative Investments Society in UNSW to mentor a younger 2nd year UNSW student. He's a solid student with a good heart and a burning work ethic. I am quietly confident he will go far in life. I loved his "golden run" story he told of how he ended up finding his investment banking job. That I played even a minor part to help him get there, I am really happy for him.
Mentors. And the only reason I have decided to consider mentoring somebody for the first time 1 on 1, is because I've had 2 great mentors, Albert and Joey. Albert was with me since 2017, and Joey was since 2018. Both are solid Christians in the same industry of funds management like me. Both are very perceptive and faithful to their investment processes, and I find I've leaned on their strengths when helping my own stock picking. I describe meeting Albert in particular, as a life-changing moment for me, not just in terms of my career trajectory, but also how I perceive the world generally and behave around others.
Newcastle trip. The only "excursion" I really had this year given COVID restrictions. Went to Newcastle with three solid UNSW friends (Jack, Luke, and James), and had a great 2 days last weekend there. Stockton (or "Stonktown" as I jokingly call it) was great and there's an interesting shipwreck you can find there from 1904 on their breakwater that I would encourage others in Newcastle to check out.
One year in a new home in Epping. Glad to say this, because before we moved into our new apartment in Epping, I had stayed in my original home in Marsfield, then 2 Airbnbs, then my friend's house, then my sister's house, then my auntie's house in HK (was on holiday in Nov 2019), before I finally moved into my Epping apartment (in Dec 2019). Having some shelter stability is always a plus.
Pilates. COVID has gotten me back into my regular running + pilates exercise on a regular basis after work now. The last time I did pilates was in 2010, but glad I picked it up again. Hoping to maintain this.
Quarantine with COVID-19. Enough said...
Recession. This was the first recession for a lot of people my age, in almost 30 years for Australia. It felt like we had even forgotten what the word ever meant. But the recession was just that. A technical one, with 2 consecutive quarters of negative GDP growth. Australia has been lucky and the economy is recovering faster than US or Europe who are still in lockdowns. I am optimistic about Australia's near term outlook.
Sydney Science College. A private investment which I have become much more invested in this year. I love the idea of Sydney having its first STEM high school. We are trying to reimagine the 21st century school and set a gold standard for what schools should strive to be. Pleased to say we will be having 20+ students beginning year 11 at the school in 2021. The principals, Joey and Shaun, and the rest of the team, have worked tirelessly with the building, and the syllabus, to create the best environment in Sydney for learning. I firmly believe they have. I used to be tutored by them and so I can attest to this learning environment. 100% would encourage anybody interested to speak to me or the principals about the school.
Tutoring Tim. Typically most Sundays after church, I tutor maths for a year 9 student, Tim. I've been incredibly fortunate to have met an incredible kid who despite some family hardships, has remained generally firm in his work ethic. I recall his T2 and T3 exams declined pretty significantly to ~70 (historically we average 90% since 2018), but I was glad we recovered from the trough in T3, with an 84% in T4 2020. He has taught me patience, but also perseverance in adversity. I hope he keeps this work ethic up, and continue to tutor him for year 10 in 2021.
US presidential election. Lots of twists and turns. However, the only thing I hope for is that whatever people's views are, we can be constructive and loving with one another, and set an example for future generations. Is that asking for too much? Maybe?
Virtual worlds. I have been obsessed with the idea of the multiverse this year, ever since Unity Software went into the public markets in an IPO (initial public offering), a game engine provider for mostly mobile game developers (but can also do movie editing, etc). Epic Games I believe, is at the forefront of this idea. The best way to envision multiple virtual worlds all connected by a common game engine is to watch Wreck it Ralph 2. This paints the next decade of gaming to be one that is incredibly exciting!
Workshop at Investing 4 Charity (I4C). My first time walking students through a discounted cash flow model I had built from scratch back in 2017 on Crown Casino. It was a walk down memory lane, and I was glad I got the opportunity to share screen and zoom my model to students. I was originally an education director at I4C, but continue to speak as a guest whenever possible. I think inspiring the next wave of university students is important.
Xbox S/X vs PS5. I prefer the PS5, but am still waiting for stock in Sydney so I can trade our PS4 to get a cheap PS5 from EB Games... For context, it's been 7 years since our last console launch, with the PS4 and Xbox One! It has really been that long! I was only in year 11 at NSB back then... A lot has happened in those 7 years.
Yellow sticky notes. 2020 was the return of my sticky notes. Actually, something I was known for using back in year 9-10 in my early days, and what I think was part of my bigger recipe for improving my time management and work ethic generally with measurable KPIs. I make it a habit to write down my tasks at night, for the next day. I notice the trick is often just cramming like 10+ tasks in one day for me because it pushes me to work more efficiently because I know I have so many tasks to get to. The point of that is not necessarily to ensure everything gets done, as I often have to delay tasks, but the point is to motivate me subconsciously to work efficiently and not waste time. My bosses, Jacob and James, have been instrumental in assisting me to think this way, which I am very thankful for.
"Zooming" everything. We've turned the company Zoom, into a verb.
Wishing everybody a merry Xmas no matter where you are or where you are from despite this tough 2020,
Michael Li
