Rule du Jour: Rule #87 — Hoard After Victory (my Cash Position) (Patreon)

P.S. All of my life I've been obsessed w studying military history, and I often apply the principles of military strategy and Sun Tzu’s teachings to investing. Please excuse the strong military undertone — it’s simply how I think about capital and risk.

Rule #87 — Hoard After Victory (Cash Position)

I always trade with the rhythm of the market — the seasons, the cycles, and the harvests.
When conditions are bleak — in the depths of winter — that’s when I deploy. I take calculated, outsized risks when fear dominates and valuations are in the toilet. I thrive in the bear, bottom-fishing when others panic sell. Rem Billions are made in the Bear!

But when my accounts surge, like right now, and the tide turns in my favor, I shift from offense to defense.

The Rule — “Hoard After Victory”

Principle: After significant wins, withdraw a portion of capital from risk.
Cash is not laziness — it is my ammunition.

“After every profitable campaign, I harvest. Cash is the weapon of survival, not an idle asset.”

This mindset allows me to re-enter with full control — never forced, never desperate. I’ve already played extreme hardball with Tesla; now it’s time to rebuild and fortify. This philosophy has served me well: play the cycles, survive the drawdowns, and stay liquid enough to strike when gray or black swans appear.

Case Study — My Tesla Leverage

Earlier this year, I took on an extraordinary risk. Using proceeds from MSTR sales, I leveraged aggressively: for every 100 shares of MSTR sold, I sold 5 Tesla put contracts and bought 5 LEAPS.
It was bold — arguably reckless. Had Tesla collapsed to zero overnight, I would have blown up my account. But it was a calculated offensive move, fueled by my ultra strong conviction in the AI future for Tesla.

Now that the position has delivered outsized returns, it’s time to shift from offense to fortification:

• Let it cook: The extreme position is established. My focus now is endurance — not expansion. I won’t increase exposure just because the trade is working.It will increase by itself.

• Harvest: As theta decays and volatility compresses, I’ll take profits from Crypto and resist the urge to roll into fresh risk. Realized gains will be redirected into cash and short-term options perhaps even STRC etc.

• Rebuild optionality: Hoarding cash is not defensive — it’s strategic. Liquidity restores flexibility and readiness for the next asymmetric opportunity.

Fortification Phase aka Cash Buildup

As my account value has exploded, my cash-to-equity ratio has fallen sharply. My former comfort level of 7% cash has eroded — my liquidity base has not grown with my gains. That imbalance must be corrected. Eg Imagine a $10,000 account with $700 cash, well that account is now $20,000 with $700 cash. That is the problem.

My goal now is fortification: to replenish reserves, restore balance, and ensure that when the next cycle turns — or when the next swan arrives — I’m positioned not as prey, but as a predator.

Final Point

Cash is the blood of opportunity.
Victory is not the time to advance — it’s the time to reload.