CAN'T KILL PROGRESS – STRATEGY OF
ASSET ALLOCATION INTO TOMORROW DEFINING COMPANIES

MACRO OVERVIEW
The Can't Kill Progress Strategy is designed for investing and reinvesting into companies that will define tomorrow on long term basis.

By accumulating positions overtime in prospective companies for long term holding with occasional profit fixing, but only in order to get back in cheaper or to free cash for fresh opportunities, the Strategy is built for success.

In terms of diversification and focus, we adhere to a balanced approach.

On one hand, the Strategy focuses on concentration into few key industries that will drive tomorrow – and into the best companies within the industries at that.

We believe that overdiversification can lead to subdued returns of the strategy over long haul.

On the other hand, we constantly monitor markets and media for new industries and fresh high-potential opportunities, in order to be ready to add them to our model portfolio (or, at least, to our watchlists!).


When it comes to managing weights of positions within the portfolio, the idea of Can't Kill Progress Strategy is to evolutionary select emerging leaders with passage of time.

In other words, the key task of our Strategy is to be invested in the next TSLAs and FAANGs before they are seen as such by general public.

It is possible only by gradually allocating more weight and funds overtime to the companies in our model portfolio which start – and continue – to truly realize their potential.

Algorithm for this is relatively simple:

First, we start with our watchlist, where we monitor a broader range of not only companies that are listed now, but also those who are about to public in near future.

We also monitor various other instruments, such as SPACs (before they close deal and change ticker), ETFs (especially industry specific, holdings of which provide a great range of stock hints) and some others.


Then, we select stocks from the watchlist that fit our investment criteria, thus actually filling our model portfolio.

After that, the allocation is gradually shifted overtime to growth leaders, especially to those who perform the best in terms of market cap growth.

With that, we deepen our research to focus on the more heavyweight tickers, to continuously confirm we are on the right track (or, on the contrary, to spot major problems in advance to shift away from a problematic name).

By executing our strategy in this manner, it will be very hard to actually miss the key success stories of the next 10 years, as the growth leaders will eventually:

· Start making significant earnings with substantial profit margins;
· Start being mentioned in the financial and social media more often;
· Start to significantly appreciate in terms of market cap.

It is the aim of the Strategy that resulting allocation will be up to 80% of the portfolio in the 3-5 leading names within 3-5 years from the initiation of the Strategy, allowing for 50x and more returns on the initial investments into the names.

Critical things to accept:

· There is no ceiling to growth
· A few failures are OK, risk is inevitable

The set of companies in the model portfolio is to be constantly reviewed and updated, with major shift to newer names every 5-10 years.

Conservative version of portfolio

Conservative portfolio is built specifically for risk-averse investors. It consists of large and mega-cap companies, as well as ETFs, that nevertheless have high potential for further growth.

At the same time selected instruments offer subdued volatility of returns in comparison with our primary portfolio.

You can find our conservative portfolio contents in the Attachment 3 to this presentation

OVERVIEW OF THE SELECTED INDUSTRIES

At this point, there are several key industries on our watchlists, which we believe will define the world for the next 5-10 years. These areas include:

· AI & Big Data
· Search & Social Media
· Genomics & Bionics (Biotech)
· New Finance
· Private Spaceflight
· Electric Flight

In this part of our presentation, we will give a brief explanation for each industry and why we think it is critical to be invested in key players of these industries.

As for individual companies, you can find our current portfolio contents in the Attachment 1 to this presentation

AI & BIG DATA

This is the key focus of the Strategy, as data is set to become most / one of most valuable commodities in the world (which is already true to a large extent).

Tons of data generated by sources all over the world in real time each day, making it a major task to organize, clean and make sense of it all.

Companies that will succeed in doing so will see immense demand of their services worldwide. Types of companies that are in this sector include:

· AI as a service for real-life applications
· Data storage / warehousing
· Process automation as a service

Preference in this sector is given to newer companies as the pure plays of the sector are only recently started to go public.

SEARCH & SOCIAL MEDIA

Such sectors as social media and web search are unthinkable nowadays without AI application, and the amount of data those companies are dealing with on everyday basis is astronomical. Thus, we cannot ignore these players in the model portfolio of our Strategy.
GENOMICS & BIONICS (BIOTECH)

Genomics is a frontier field of medicine, with huge promises to fix genetic deviations in humans as well as curing previously uncurable diseases.

Bionics will be irreplaceable once prosthetic limbs and organs reach higher levels of authenticity and acceptance by the human body (as well as cost per patient).

Biotech in general is becoming more and more prevalent in everyday lives, especially with the COVID-19 pandemic the field has risen to the forefront of global attention.

NEW FINANCE

By new finance we understand the fresh generation of banks and bank-like fintech companies, exchanges and brokers – which are more positively perceived by younger audience and thus have a real chance of growing with the new generation.

Greater accessibility variety of services, instruments of investment and lower fees provide a unique opportunity for leaders of this sector to become household names.

PRIVATE SPACEFLIGHT

Rise and democratization of commercial space tourism, telecom services and sub-orbital transportation will drive not only huge demand from 1st world population, but will also help develop technologies for improvement of everyday life for all people.

ELECTRIC FLIGHT

The trend in automobile industry to go fully electric is clear as day.

Not being limited to cars, however, the trend encompasses all fossil-fueled sectors, providing new vectors to consider.

Our vector of choice is aviation, as we see it one of the most promising fields for electrification in the coming decade

STOCK SELECTION GENERAL
GUIDELINES & THESIS

1) The company is backed / funded by an industry insider, also preferably led by a CEO with a clear vision of future and passion for his business;

2) Promotion / mentions in key financial media are also a great plus (like Bloomberg / Reuters), however most of the time we have to dig deeper;

3) High growth potential not only in terms of industry, but in terms of market cap as well;

The watchlist allows us to listen to the flow of information in financial and social media with more focus.

It is a great help on journey to select out revolutionary technological ideas that will transform our lives over the next decade.

After a company is selected into our model portfolio, we construct an initial thesis of why it was added. It will be important to know why the company was added in the first place after several years of holding.



The thesis usually consists of the following points:

1) Ownership of the company. Who owns it and its debt (if there are any listed bonds);

2) Recent insider transactions. Preference is given to companies with recent insider buying;

3) Coverage by analysts and overall perception of the company in the social media;

4) Balance Sheet and Cash Flow Statement. This one is less critical for newer companies, we more look into SEC filings like 13D, Proxy statements. However, key financial filings become relevant as the company develops.
CAPITAL ALLOCATION
AND TRADE EXECUTION

The Strategy does not involve leverage or short-selling. The model portfolio does not apply rebalancing.

Each new batch of capital for the Strategy is divided into 4-6 equal parts (depending on market conditions), with the parts then to be allocated into the current version of model portfolio on monthly basis, thus taking 4-6 months to allocate the full amount of each new batch.

Such time allocation of capital allows to dollar cost average entries for all tickers involved in the model, decreasing risk over the long haul and attaining more favorable cost basis of each position.

Within each month and for each ticker involved in the model portfolio, an entry point is located using technical analysis (relatively simple, but very powerful proprietary technical approach involving Bollinger Bands and orderflow approach to market timing).

Our proprietary technical system is very good at determining trends, thus allowing us to sometimes even skip on a monthly execution in case of apparent downtrend on the instrument. This is done in order to wait for a more stabilized, lower entry price. In case of sharp uptrend, our system allows to decide if we should wait for a pullback or actually have to chase the price.
Same goes to individual cases of downtrends, when there is a clear option to wait out a large move down in cash, allowing us to get back into the instrument once price settled lower and ready for reentry.

We are also following key macroeconomic and media developments in order to confirm that market climate is in general allows for our Strategy to prosper. Apart from macroeconomics, we monitor political, monetary and fiscal situation in the US as well.

While it is very difficult to forecast the next major market crash, such monitoring allows us to know if we should take any action in relation to our total portfolio (to average out en-masse for time being, for example), or just wait out the storm.

This material is intended for information purposes only, and does not constitute investment advice, a recommendation or an offer or solicitation to purchase or sell any securities, funds or strategies to any person in any jurisdiction in which an offer, solicitation, purchase or sale would be unlawful under the securities laws of such jurisdiction. The opinions expressed are subject to change without notice. Reliance upon information in this material is at the sole discretion of the reader. Investing involves risks.
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