Module 01
The Asymmetry Engine
Before anything else — size the bet. A trade is only worth taking when your potential gain structurally dwarfs your potential loss. Adjust the scenarios below and read the ratio in real time.
The Golden Rule
Never enter a position where the upside is less than 3× the downside. This isn't optimism — it's math. You can be wrong 60% of the time and still compound wealth with 3:1 asymmetry.
Bull scenario
+70.0%
+RM 35.00 per share
Bear scenario
−24.0%
−RM 12.00 per share
2.9
Risk / Reward
+7.1%
Expected value
Adjust the sliders to evaluate your setup.
Why asymmetry matters — the math
Win rate independence
At 3:1 ratio — you only need to be right 25% of the time to break even. At 4:1, it drops to 20%. Your edge doesn't come from being right more often. It comes from winning bigger when you are right.
The symmetric trap
1:1 trades require a 50%+ win rate to be profitable after fees and taxes. Most retail investors trade 1:1 setups and wonder why they're not building wealth. Symmetry is the enemy of compounding.
Expected value is the only metric that matters
EV = (probability of win × gain) − (probability of loss × loss). A positive EV trade is always worth taking if sized correctly. The goal is not certainty — it is structural edge repeated over hundreds of decisions.
Module 02
Thesis Builder
A real thesis has four mandatory components. If any are missing, you don't have a thesis — you have a hope. Complete all four dimensions before moving to the checklist.
The one-sentence law
If you cannot compress your entire investment case into a single sentence that a non-investor understands, you are not ready to invest. Complexity is noise in disguise. Simplicity is the mark of genuine understanding.
01 — The Variant View
What specific belief do you hold that the market consensus does not currently hold? If your view matches consensus, you're buying what everyone already knows.
Earnings will significantly beat estimates due to an under-modelled revenue driver
Market has mispriced a regulatory or policy outcome
Hidden or off-balance-sheet asset not reflected in current valuation
Sector re-rating will expand the multiple independent of earnings
02 — The Moat Assessment
What structural competitive advantage protects this company's returns over a 5+ year horizon? Without a moat, today's profits are tomorrow's competition.
Network effects — the product becomes more valuable as more people use it
Cost advantages or economies of scale unavailable to competitors
High switching costs — customers are locked in by integration or contracts
Intangible assets — brand, proprietary IP, or regulatory licence
03 — The Catalyst
What specific event forces the market to reprice this stock within 12 months? A thesis without a catalyst is a thesis that lives in your head forever.
Earnings beat or management guidance upgrade in the next 1–2 quarters
New major contract, product launch, or market entry announcement
Regulatory approval, policy change, or government contract award
Index inclusion, analyst initiation, or institutional coverage event
04 — The Kill Condition
What single event or data point would prove your thesis fundamentally wrong? Write it now, before you own shares. Pre-commitment beats rationalisation every time.
Thesis completeness
0 / 4 components
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No thesis yet
Select your variant view, moat type, catalyst and write your kill condition to generate a verdict.
Module 03
Pre-Trade Checklist
Run this before every trade. Not after. Not during. Before. Each item represents a category of mistakes that has cost real investors real money. Tick only when genuinely verified.
0 / 12
Valuation gates
I know the current P/E, EV/EBITDA, and P/S versus the sector median
Entering without relative valuation context is speculation, not investing. You need a benchmark to know if the price is reasonable.
I have run or reviewed a DCF with at least two discount rate scenarios
Even a rough DCF anchors you to intrinsic value and prevents you from chasing momentum dressed up as fundamentals.
The stock trades at a meaningful discount to my conservative intrinsic value estimate
Margin of safety is not optional — it is the only free lunch in investing. It absorbs your inevitable estimation errors.
Business quality gates
Revenue growth trend is consistent or accelerating over 3+ years
A single great quarter is noise. Three years of trajectory is signal. One quarter of acceleration does not make a compounder.
Gross margin is stable or expanding — pricing power is demonstrably present
Shrinking gross margins signal a moat in decay. Pricing power is the single most important attribute of a high-quality business.
Free cash flow is positive and growing — earnings are real, not accounting artefacts
Net income can be manipulated through accruals, capitalisation, and one-offs. Free cash flow cannot be faked.
ROIC exceeds WACC — the business is creating, not destroying, shareholder value
A company with ROIC < WACC destroys value on every dollar of growth. Growth for its own sake is not a strategy — it is an accelerant for value destruction.
Risk gates
Debt/Equity is within an acceptable range for this specific sector and cycle
High leverage amplifies everything — including the downside scenarios you are trying to size in the Asymmetry Engine.
I have identified the top 3 risks and each has a specific, pre-committed response plan
Unknown risks are existential. Named risks are manageable. Writing the response in advance prevents in-the-moment rationalisation.
The risk/reward ratio is confirmed at 3:1 or better in the Asymmetry Engine (Module 01)
If you have not run Module 01 — stop here and do that first. No level of business quality justifies poor risk/reward.
Behavioural gates
I am not buying this primarily because the stock has already risen significantly
FOMO is the single most expensive emotion in markets. If the primary reason is price momentum, the entry is emotional, not analytical.
My kill condition from the Thesis Builder is written and I commit to acting on it without discretion
The kill condition is only useful if it is non-negotiable. Pre-commitment is the mechanism that stops you from holding a broken thesis indefinitely.
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Begin the checklist
Tick each item only when you have genuinely verified it — not when you think it might be acceptable.
Module 04
Position Sizing
The single most underrated skill in investing. Most beginners size by excitement. Professionals size by conviction, volatility, and portfolio context. This calculator translates your inputs into a concrete allocation.
Kelly Criterion — simplified
Optimal position size = Edge ÷ Odds. In practice, use half-Kelly to protect against estimation error. The formula below translates your conviction and asymmetry score into a defensible allocation that reflects your actual edge — not your enthusiasm.
Sizing output
4.2%
Portfolio weight
RM 2,100
Capital deployed
RM 504
Max risk exposure
Sizing guidelines by conviction tier
Full conviction — 8–10/10, ratio 4:1 or better, low volatility
5–8% of portfolio. This is a high-confidence, asymmetric, low-volatility setup. Size up decisively — but never exceed 10% in any single name. Concentration risk becomes existential beyond that threshold regardless of conviction.
Standard conviction — 5–7/10, ratio 3:1, medium volatility
2–4% of portfolio. Most of your positions should live here. Enough size to move the needle meaningfully if you are right. Small enough to survive intact if your thesis breaks and you must exit.
Speculative — below 5/10 conviction or ratio under 3:1
1% maximum — or skip entirely. If you cannot pass the asymmetry gate, no position size makes this trade acceptable. Do not lower your standards to justify a pre-existing desire to own the stock.
The 30-minute research cap
With AI tools, 30 minutes gives you a valuation model, earnings transcript summary, and sector comparable analysis. If you cannot form a clear thesis after that window — more research will not help. You have a framework problem, not an information problem. Use this tool to solve the framework problem first.