To The Moon

Reflect on August, Plan for September: What the Market Taught Me

August was a good reminder that investing is not simply about being right. It is about being right for the right reason, at the right price, with the right position size.

Looking back at my August trading, the biggest lesson was not a particular stock or a particular return. It was learning to distinguish between a good company, a good story, and a good trade. They are three completely different things.

① August Recap — What Did I Get Right?

The trade I am most satisfied with this month was staying focused on the areas where earnings and fundamentals were actually improving, rather than blindly chasing whatever stock was moving the most.

AI infrastructure remained one of the strongest structural themes. NVIDIA's latest results reinforced that the AI investment cycle is far from finished: Q2 FY2027 revenue came in at $96.2 billion, while management guided to approximately $108 billion for the following quarter. NVIDIA subsequently jumped about 8.7%, helping lift both the Nasdaq and broader technology sector.

But the more interesting development was what happened outside NVIDIA.

Salesforce surged more than 22% after its earnings, while CrowdStrike also rallied strongly. This tells me something important: the AI trade may be broadening from chips and data centers into software monetization.

That was one of my better observations in August.

Instead of asking only, “Which AI stock will go up next?”, I started asking:

«Where is AI actually showing up in revenue, margins, productivity and customer spending?»

That is a much better question.

② What Didn't Go According to Plan?

The biggest mistake I made was sometimes confusing market momentum with confirmation.

When a stock rises rapidly, it is very tempting to believe the market has already discovered something that I haven't. But a rising price is not automatically evidence that the thesis is correct.

August also reminded me how dangerous it can be to buy after a major move simply because the narrative feels convincing.

The memory and semiconductor trade is a perfect example. The long-term AI infrastructure thesis can be correct while an individual stock still falls 10%, 20% or more because expectations were already too high.

This is something I want to improve:

I don't want to buy a great story at any price.

I want to identify:

1. What the market expects.

2. What the company actually delivers.

3. Whether the company can exceed those expectations.

4. How much of that upside is already reflected in the share price.

That fourth question is probably the most important.

A company can report excellent earnings and still fall.

A company can report good—not spectacular—earnings and explode higher.

The difference is often expectations, not fundamentals.

③ My Biggest Lesson From August

August changed the way I think about risk.

I used to think risk meant simply asking:

«“Could this stock go down?”»

Now I think a better question is:

«“What happens to my portfolio if I am completely wrong?”»

That naturally brings me to position sizing.

A high-conviction idea does not necessarily deserve a huge position.

In fact, the higher the uncertainty, the more important position sizing becomes.

For example, I would rather own a small position in a high-volatility growth stock and have the freedom to add when the thesis strengthens than enter with a huge position and become emotionally trapped when the price falls.

This is especially important in today's market because volatility can move extremely quickly around earnings, Fed decisions and macroeconomic data.

④ If I Could Restart August…

I would do three things differently.

First, I would buy in stages.

Instead of trying to identify the perfect entry price, I would divide capital into several tranches.

Initial position.

Confirmation position.

Breakout or fundamental-confirmation position.

This reduces the pressure of having to predict the exact bottom.

Second, I would leave more cash available.

Cash is not necessarily “doing nothing.”

Cash is optionality.

When the market suddenly gives you an opportunity because of an earnings miss, macro shock or temporary panic, having cash is a competitive advantage.

Third, I would spend less time predicting the market and more time measuring it.

Instead of saying, “I think September will be bullish,” I want to observe:

- earnings revisions

- market breadth

- Treasury yields

- volatility

- credit conditions

- sector rotation

- institutional positioning

- price reaction to earnings

The market doesn't owe us a forecast.

It gives us information every day.

Our job is to interpret it.

September Outlook — What Am I Watching?

September could be much more interesting than August.

The biggest macro variable is still the Federal Reserve.

The market is trying to understand how the Fed will balance inflation, employment and financial conditions. The Jackson Hole meeting has therefore become particularly important, especially with Kevin Warsh facing questions about the future direction of monetary policy.

For me, the key question is not simply:

“Will the Fed cut rates?”

The better question is:

“What will the Fed's reaction function look like if inflation remains sticky while employment weakens?”

That could determine whether September becomes a continuation of the growth rally—or a much more volatile month.

Sector #1: AI Infrastructure

I remain constructive on AI infrastructure, but I am becoming more selective.

NVIDIA's latest numbers suggest that demand for accelerated computing remains enormous, while management also highlighted potential memory-component shortages.

That creates opportunities across the ecosystem:

Semiconductors → HBM → memory → networking → cooling → power → data centers → software.

But I don't want to chase every company associated with “AI.”

The question is:

Who actually captures the economics?

Sector #2: Software

This may be the most interesting rotation to watch.

For the past two years, investors have heavily focused on GPUs, hyperscalers and data centers.

But eventually the question becomes:

«Who makes money from all that computing power?»

Salesforce's strong reaction to earnings suggests investors are becoming more willing to reward software companies when AI begins translating into actual commercial results.

If this trend continues, September could see further rotation from “AI infrastructure” toward AI monetization.

That is a theme I want to watch very closely.

Sector #3: Memory & Semiconductors

I remain bullish on the structural memory cycle, but I would be careful about chasing vertical moves.

The AI boom is increasing demand for high-performance memory, and NVIDIA's comments about memory supply reinforce how interconnected the semiconductor ecosystem has become.

However, semiconductor stocks are cyclical.

The biggest risk is not necessarily weak demand.

It is expectations becoming too aggressive.

When everyone starts believing that earnings will continue accelerating forever, even excellent results may no longer be enough.

My September Strategy

I am not planning to become dramatically more aggressive simply because the market is strong.

My September framework is:

1. Core positions:

Continue holding high-quality businesses and broad-market exposure.

2. Growth positions:

Focus on companies where earnings estimates are moving higher rather than simply companies with attractive narratives.

3. Speculative positions:

Keep them small enough that a large drawdown does not damage the overall portfolio.

4. Cash:

Maintain some dry powder for volatility.

5. Risk management:

Before entering any position, define not only the upside case, but also the reason I would admit that my thesis is wrong.

That last point is critical.

A stop-loss is not always a fixed percentage.

Sometimes the real stop-loss is:

“The fundamental reason I bought this stock no longer exists.”

Final Reflection

If I had to summarize August in one sentence, it would be:

«The market rewarded conviction, but punished complacency.»

NVIDIA showed that the AI investment cycle still has enormous momentum. Salesforce and other software names showed that investors are increasingly interested in the monetization side of AI. At the same time, the market's reaction to different earnings reports reminded me that expectations matter just as much as results.

My biggest goal for September is therefore not to maximize the number of winning trades.

It is to improve the quality of my decisions.

I want fewer emotional entries.

Fewer FOMO purchases.

Better position sizing.

More patience.

And a clearer distinction between a stock I like, a stock I want to own, and a stock that is actually worth buying at today's price.

August gave me the data.

September is where I try to apply the lessons.

Because ultimately, the goal of a monthly review isn't to prove that my past decisions were right.

It is to make sure that my future decisions are better.

#Reflect on August, Plan for September

@Tiger_SG  [龇牙]