thesis-tracker

# Investment Thesis Tracker: Post-Buy Discipline Track an investment thesis for a holding. First use on a company → build the thesis; later uses → quarterly check. **Supported input**: company name (auto-decide build vs track); `company build` (force rebuild); `company quarterly check` (against latest earnings). > "Buying is only the beginning. The real work is continuous tracking through the holding period." — Li Lu > > "When the facts change, I change my mind. What do you do, sir?" — Keynes ## Design Philosophy Most investors' process is: research → buy → pray. Without systematic post-buy tracking, they: refuse to sell when they should ("wait, it'll come back"); panic-sell when they shouldn't ("down 20%, was I wrong?"); forget why they bought ("why did I buy this again?"). Buffett and Li Lu write down sell conditions **before** buying, then check the thesis each quarter. ## Step 1: Decide the Mode Check whether a thesis file already exists (use `read_file` on `reports/{company}-thesis.md`): not found → **Build** (Mode A); found → **Track** (Mode B). --- ## Mode A: Build the Investment Thesis ### A0: Data Collection Use `web_search` to get the current price, valuation (PE/PB/dividend yield), and latest financials. If a research report exists, `read_file` it first. Use `financial_rigor` (`command=verify_valuation`) to verify valuation, `financial_rigor` (`command=verify_market_cap`) to sanity-check market cap. ### A1: Core Thesis (must be writable in ≤200 words) The thesis must answer 5 questions, one sentence each: ``` I bought {Company} at {price} because: 1. The essence of this business is ___, and I understand how it makes money. 2. Its moat is ___, and it's widening / stable. 3. Management is ___, trustworthy because ___. 4. The current price is a {discount}% to intrinsic value; the margin of safety comes from ___. 5. Even if I'm wrong, downside is contained because ___. ``` **If you can't fill 5 sentences, the thesis itself is flawed — the buy decision isn't clear enough.** ### A2: Core Assumptions List Break the thesis into verifiable assumptions (3-7 typically; too few = shallow thinking, too many = unfocused): | # | Core Assumption | How to verify | Frequency | Status | |---|-----------------|---------------|-----------|--------| | 1 | e.g. revenue growth stays >15% | Quarterly revenue growth | Quarterly | 🟢 Holding | | 2 | e.g. gross margin stable >60% | Quarterly gross margin | Quarterly | 🟢 Holding | ### A3: Red Lines (triggering any one = must re-evaluate) | # | Red-line condition | Severity | Action on trigger | |---|--------------------|----------|-------------------| | 1 | Management integrity problem (fraud, related-party) | Fatal | Exit immediately | | 2 | Core business revenue down 2 consecutive quarters | Severe | Trim 50%, re-evaluate | | 3 | Moat explicitly breached (competitor reaches parity) | Severe | Deep research, consider exit | | 4 | Regulatory change fundamentally alters the business model | Severe | Re-value intrinsic value | | 5 | Management large unplanned disposal | Warning | Investigate | | 6 | **Macro trend reversal for this name's end-market** — e.g. demographic clock (population decline) for consumer/property/education names; consumption downgrade (居民边际消费下降); generational shift away from the category | Severe | Re-evaluate the long-term demand base; for consumer-dependent names, this is often a slow-moving but fatal headwind — assess whether the thesis still holds at a structurally lower growth path | > The red line on macro trends (demographic clock / consumption / generational) is deliberately explicit: a value-investing thesis that picks a consumer name without weighing population decline and consumption-trend headwinds is incomplete. For non-consumer names (e.g. pure B2B industrial), this red line may be loose; for consumer/retail/education/property names, weight it heavily. > Duan Yongping: "There are only three reasons to sell: 1. you got the buy wrong; 2. the fundamentals changed; 3. you found something better." ### A4: Valuation Anchors | Metric | At buy | Optimistic target | Neutral target | Pessimistic | |--------|--------|-------------------|-----------------|-------------| | Price | | | | | | PE (TTM) | | | | | | Market cap | | | | | | Intrinsic value estimate | | | | | | Margin of safety | | | | | ### A5: Save the Thesis Use `write_file` to write `reports/{company}-thesis.md`, including: build date, buy price and position, core thesis (5 sentences), assumptions list, red lines, valuation anchors, tracking table (empty initially). --- ## Mode B: Tracking Check ### B1: Read the Existing Thesis Use `read_file` to load core thesis, assumptions, red lines, last check record. ### B2: Gather Latest Data Use `web_search` / `get_stock_news` / `get_financial_statements`: ① latest earnings (if new quarter/year); ② recent material events (management, regulation, competition); ③ current price and valuation; ④ insider transactions (major shareholder changes). ### B3: Check Each Assumption | # | Core Assumption | Last status | Latest evidence | Current status | Change | |---|-----------------|-------------|-----------------|----------------|--------| | 1 | Revenue growth >15% | 🟢 Holding | Q4 revenue growth 12% | 🟡 Weakening | ⚠️ | Status definitions: - 🟢 **Holding** — latest data supports - 🟡 **Weakening** — still acceptable, but trend is unfavorable - 🔴 **Impaired** — data clearly does not support - ⚫ **Broken** — assumption has been overturned ### B4: Red-Line Check Check each red line; any triggered → flag prominently in the report + clear action recommendation. ### B5: Valuation Update Use `financial_rigor` (`command=verify_valuation`) to recompute PE/PB/ROE; compare against buy-time and last check: | Metric | At buy | Last check | Current | Change | |--------|--------|------------|---------|--------| | Price | | | | | | PE (TTM) | | | | | | Intrinsic value estimate | | | | | | Margin of safety | | | | | ### B6: Output the Tracking Report Structure: ① Thesis health score (out of 10); ② Assumption check table; ③ Red-line check table; ④ Key changes this period (≤500 words); ⑤ Valuation update; ⑥ Conclusion and action; ⑦ Focus for next check. **Health formula**: `10 - (⚫broken × 3) - (🔴impaired × 2) - (🟡weakening × 1) - (red-lines triggered × 5)`, min 1, max 10. | Score | Meaning | Action | |:-----:|---------|--------| | 9-10 | All assumptions hold, thesis stronger than at buy | Consider adding | | 7-8 | Core assumptions hold, some weakening | Continue holding | | 5-6 | 1-2 assumptions impaired, core logic intact | Hold but raise alertness | | 3-4 | Multiple assumptions impaired, foundation shaken | Consider trimming | | 1-2 | Red line triggered or core assumption broken | Strongly consider exit | **The conclusion must clearly answer**: ① Is the thesis still intact? (intact / weakening / impaired / broken); ② What to do? (add / hold / trim / exit); ③ Next check timing (next earnings / a specific event). ### B7: Update the Thesis File Use `write_file` to append this check to the tracking table in `reports/{company}-thesis.md`: | Check date | Health | Key change | Action | |------------|:------:|------------|--------| | 2026-04-09 | 7/10 | Revenue growth slowed to 12%, but margins improved | Hold | --- ## Key Principles - **Write sell conditions before buying** — decisions made calmly beat decisions made in panic. - **Assumptions must be verifiable** — "a great company" is not a thesis; "ROE>25% and stable" is. - **Act when a red line triggers** — "let's wait and see" is how big losses happen. - **Thesis breaking ≠ stock falling** — a 30% price drop doesn't force a sell; a broken thesis does. - **Be honest about mistakes** — if the thesis was wrong, admit it; don't defend it to save face. - **Weigh macro headwinds for consumer names** — demographic decline and consumption downgrade are slow but can be fatal for consumer/property/education theses; bake them into red lines, not just quarterly checks.