Cocktail Investing

Chapter 8Cocktail Thematic Investing

The signal is the truth. The noise is what distracts us from the truth.

– Nate Silver

We cannot solve our problems with the same level of thinking that created them.

– Albert Einstein

The key to investing is not assessing how much an industry is going to affect society, or how much it will grow, but rather, determining the competitive advantage of any given company and, above all, the durability of that advantage.

– Warren Buffett

At the end of this chapter you'll have an understanding how we put together the puzzle pieces that we've given you over the last few chapters. We aim to distill this noise of disparate data points into clear investable signals that cut across industries, as defined by Wall Street and others. We'll also give you a list of these investing signals, what we call Cocktail Thematics, as they stand today and then we're going to break down one of them into industries and companies that give rise to the investing contenders that we'll then put under the microscope in Chapter 10.

Over the last few chapters, we've thrown quite a bit at you, and at first it might feel like too much, as Figure 8.1, which Chris created based on what you've read so far, clearly shows. But from our experience, once you change your mindset from the Wall Street herd-think to one that connects the dots, and are able to really see the world around you, you won't be thinking that anymore.

Figure 8.1 Investing noise

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