Process over everything
The Sandbox Daily (3.31.2026)
Welcome, Sandbox friends.
Today’s Daily discusses:
process over everything
Let’s dig in.
Blake
Markets in review
EQUITIES: Nasdaq 100 +3.43% | Russell 2000 +3.41% | S&P 500 +2.91% | Dow +2.49%
FIXED INCOME: Barclays Agg Bond +0.25% | High Yield +0.97% | 2yr UST 3.801% | 10yr UST 4.321%
COMMODITIES: Brent Crude +4.94% to $118.35/barrel. Gold +3.46% to $4,715.1/oz.
BITCOIN: +1.96% to $67,832
US DOLLAR INDEX: -0.66% to 99.85
CBOE TOTAL PUT/CALL RATIO: 1.07
VIX: -17.50% to 25.25
Quote of the day
“The greatest mistake you can make in life is to continually fear that you will make one.”
- Elbert Hubbard
Building conviction in a world of shifting narratives
In ode to Cullen Roche, here are three things I think I think:
1. No and know
Everyone needs an investment philosophy.
A framework of first principles.
Marty Zweig famously had his “Don’t fight the Fed,” while Bob Farrell is often cited for his 10 rules of thumb. My personal favorite? Sam Ro.
Simple, rules-based, arbitrary heuristics, technicals… whatever it is, make sure it fits you. You can’t simply copy someone else.
If the philosophy doesn’t fit your temperament, you’ll fall apart at all the wrong moments. The key is aligning your temperament with your investment strategy and building from there.
My no and know philosophy is simple.
“No” means declining a lot of things. And, when I say a lot, I mean more than you think. I owe a debt of gratitude to Justin Waring at UBS for teaching me this. He said no to everything.
Then, because you say no to so many things, what you do own, you can know these assets and structures very well.
Jim Cramer is known for calling this “buy and homework.”
2. Water the flowers, cut your weeds
You only get a few investment ideas truly right over your investing horizon – and you only need a few.
For me, it was Texas Pacific Land Corporation (TPL). Hat tip to Horizon Kinetics and my old boss at UBS, Greg Marcus, for that one.
The idea here is simple: allocate more capital to your best-performers while trimming or exiting your dogs. Over time, this can significantly improve returns by letting winners compound and preventing losers from dragging down your portfolio.
When you find one of these high conviction ideas, you have to be willing to stay with them.
That can mean gut-wrenching volatility and drawdowns along the way. TPL, for example, I’ve experienced five separate +40% pullbacks along the way, despite holding tax lots showing 8x and 10x baggers.
Speaking of which…
3. Volatility is the toll you pay to play
Volatility is the price you pay for performance.
Seriously, Ryan Detrick of Carson Group has the data to back it up.
I believe few people in this business – investment professionals, clients, or otherwise – can truly stomach volatility.
However, if you can stick out those thorny downdrafts and stay disciplined to your process, you can create an arbitrage, especially in a market like today that’s dominated by algo traders and passive investing.
Markets move in the blink of an eye. Momentum, exacerbated by these two behemoth structural shifts, contributes to my disciplined, stay-invested mentality because markets will move before you gain the mental fortitude to buy back in.
You may not like the rules of the casino, but that’s how they work and it’s best not to position yourself against the grain.
In volatile periods, I try to deconstruct what the market is saying versus what’s actually happening.
Many times, the move is driven by the narrative. It’s price, rather than fundamentals.
With good, high-quality assets, earnings don’t usually change that quickly. The market’s perception can change much faster than underlying fundamentals.
In those moments, the key is separating narrative from reality.
Sometimes that leads you to act, but often the right response is to do nothing: to hold your position if the core investment thesis and fundamentals remain intact.
Acting rationally in the face of volatile swings in the market and a sea of red is incredibly challenging, but that discomfort is exactly the admission price.
Those who can sit through it don’t just survive volatility, they get paid for it.
That’s all for today.
Blake
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Welcome to The Sandbox Daily, a daily curation of relevant research at the intersection of markets, economics, and lifestyle. We are committed to delivering high-quality and timely content to help investors make sense of capital markets.
Blake Millard is the Director of Investments at Sandbox Financial Partners, a Registered Investment Advisor. All opinions expressed here are solely his opinion and do not express or reflect the opinion of Sandbox Financial Partners. This Substack channel is for informational purposes only and should not be construed as investment advice. The information and opinions provided within should not be taken as specific advice on the merits of any investment decision by the reader. Investors should conduct their own due diligence regarding the prospects of any security discussed herein based on such investors’ own review of publicly available information. Clients of Sandbox Financial Partners may maintain positions in the markets, indexes, corporations, and/or securities discussed within The Sandbox Daily. Any projections, market outlooks, or estimates stated here are forward looking statements and are inherently unreliable; they are based upon certain assumptions and should not be construed to be indicative of the actual events that will occur.
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