Doing the right thing reduces a lot of unnecessary hassle
Doing the right thing reduces a lot of unnecessary hassle!" Classic shares from Duan Yongping in 2023: "I will never become Buffett; there are many things more important than investing in my life."
At the end of 2023, the news of Duan Yongping donating 1 billion RMB to his alma mater, Zhejiang University, trended on social media.
Undeniably, ever since Duan Yongping transitioned from an entrepreneur to an investor, his attention has only increased. This is largely due to his candid and extensive sharing and interaction on Xueqiu, where he spends a lot of time.
Besides common investment knowledge and viewpoints, he also shares his small maneuvers. On December 5th of last year, Duan Yongping posted that he planned to sell more Alibaba puts (put options), along with a screenshot of the confirmation order page.
Duan Yongping also mentioned, "I can't fully grasp Tencent and Alibaba, so I can't invest heavily."
His continued high level of attention is not only due to his success in investments in Apple, Moutai, NetEase, Pinduoduo, and others, but also because of his honesty. He clearly distinguishes what he understands and earns from and what he just participates in. He not only has a strong internal gauge but also dares to share this gauge with everyone.
When everyone called him the Chinese investor most like Buffett, he said in early 2023, "Although I admire and respect Buffett, I will never become Buffett, because that's not the person I want to be. There are many things more important than investing in my life."
When asked about his extensive sharing, Duan Yongping frankly said it is just a hobby, so why call it selfless?
He also stated, "I am indeed a very lucky ordinary person who has figured out some lazy ways that might help other ordinary people a bit. Doing the right thing reduces a lot of unnecessary hassle."
How to keep oneself in a relatively relaxed state is something worth learning for those of us currently investing. As usual, Smart Investors has sorted through Duan Yongping's public content in 2023, organizing these most valuable shares for everyone.
The most important thing is the business model; so-called "instantly turning trash" was always trash
There may be dozens or even hundreds of industries and industry leaders in the world, but only a few with good business models. Using the method of finding industry leaders will easily lead to investing in those with poor business models, which might only have momentary glory.
If you have a good corporate culture or business model in mind, the probability of finding it is much higher, although still small. Without it, the probability of finding one is almost zero.
Not prioritizing the business model means you don't quite understand business yet, making investing quite painful.
I am not surprised Buffett sold TSMC. Although TSMC is remarkable, its business model is a bit exhausting and too burdensome. TSMC has always been very focused on what they do, and the results are indeed remarkable. But investing is about overall comparison, and I tend to prefer companies with better business models.
Qualitative analysis is more important than quantitative analysis, and the most important is the business model. The business model filters out the vast majority of companies, significantly reducing the importance of quantitative analysis. Understanding the business model has been the most important realization over the years, making investing much more interesting once understood.
About ten years ago, I bought a little IMAX but quickly realized its business model was poor and sold it promptly. Evaluating companies with a business model perspective is extremely helpful, especially when looking at it from a ten-year perspective.
With good products, channels become less important. The best channel is a model like Apple stores, where the channel completely aligns with the company culture; otherwise, aim to move in that direction.
So-called "instantly turning trash" was always trash. "Differentiation" is not just about being different but about "something users need but competitors have not yet satisfied," with the underlying premise that competitors have at least satisfied user needs.
Diversification deterioration generally means the main business is not strong enough, trying to find a way out through diversification, but ending up on a wrong path.
If I don't trust a company's culture and management, I will decide to leave. Understanding every detail of a company's operation to decide whether to vote for or against is very time-consuming, possibly more difficult than understanding the business model or corporate culture.
Over the past decade, I've only fully understood two companies: Apple and Moutai
Apple's timing in entering a product market is often not because they are choosing the right time but because they weren't ready or satisfied with their product before.
The most important basis for Apple's product launches is "What can I do for users?" Many years ago, rumors were rampant about Apple launching an Apple TV. I said, what can Apple do with such a big TV? And indeed, Apple didn't launch it.
I still find it hard to understand the logic of Apple launching an Apple car. What significant improvement in user experience can Apple bring with a car? In the foreseeable future, like the next 5-10 years, we're unlikely to see the Apple car as depicted in those fake videos. However, Apple's CarPlay is indeed very useful!
I did discuss Apple with Mr. Buffett, but that was in 2018, after Buffett had already bought Apple. However, I expressed my view that Apple's business model is better than Coca-Cola's, which left a deep impression on Mr. Buffett.
In the past twenty years, Apple has fallen by 40% or more from its peak at least ten times, and 10-20% drops are countless. If you bought Apple on margin, even if you didn't go bankrupt, you'd likely be scared to death.
I've never thought about reducing my Apple holdings. I always think about how to increase my holdings. If you really plan to hold for ten years, you're unlikely to lose money, at least no one has lost money in the past ten years. But the opportunity cost might not be worth it.
I guess that in another ten years, more than half of the good movies and TV series will probably come from Apple. And viewers won't even realize it, and Apple won't emphasize it much.
Before seeing Buffett, I rarely touched the stock market because I thought it was speculative and didn't want to get involved. It wasn't until I saw Buffett that I realized I might understand companies better than most people.
This is why I've always considered myself an ordinary person. Over the past decade or so, I've only really understood two companies: Apple and Moutai, averaging one every six years.
But most people think they are already very skilled, so they neither want to "enlighten" nor "observe."
I only care about what I can understand. Only those who don't understand ask everywhere: "What do you think?"
I consider betting on a 90% chance of winning an investment
Betting on a good company to fall or shorting a good company is very difficult.
Betting usually refers to a 48% chance of winning, while a 90% or higher chance of winning is what I call investment. I've never calculated this precisely, just roughly guessed. Vaguely right is better than precisely wrong.
If you don't fully understand, you shouldn't bet your life on it. Investment without betting your life is hard to consider serious "investment."
I'm a full-position advocate. My investments in US stocks are mainly in Apple, A-shares mainly in Moutai, and Hong Kong stocks mainly in Tencent. The part used to sell puts is a very small entertainment portion. Of course, if you don't understand, the "entertainment" part can become very unpleasant.
This is also one reason not to sell good companies lightly. Holding cash makes it easier to make mistakes.
One important reason not to sell good companies lightly is: what to switch to after selling? Holding cash is generally uncomfortable, and many people might sell a good company, can't hold onto cash, and then switch to a company with an unclear profit model, starting sleepless nights. It's not worth it!
My "full-positionism" mainly doesn't care about "timing," but cares a lot about "business model + corporate culture," provided that the price looks cheap from a ten-year perspective.
"Not timing" is not a reason to chase high. True non-timers are looking at ten years, and most of their money has long been invested. People who chase high and don't time find short-term drops very hard to bear.
My understanding of "not timing" is: when I think it's not expensive from a ten-year perspective and I happen to have money, I can buy without waiting for a cheaper price because this price is already good from a ten-year perspective.
Many people think (buying stocks) is like hunting, but it's actually like farming.
(Selling) has nothing to do with the current PE ratio but with the business situation over the next 30 years.
Without a traceable history of 10 or 8 years, it's hard to understand a company. Understanding a small company is almost an impossible task unless the founder is someone you've known for a long time.
Every company eventually becomes the company it's meant to be. The same goes for stock prices. There are no inexplicable stock prices in the long term, but there are in the short term.
The difficult part is determining when the valuation is cheap. Many people habitually compare cheapness to past prices, but if you don't understand the business, it's pointless to say anything.
Buffett hasn't fully explained this question either. I think: If I sell my Apple, what do I buy? For now, it seems only short-term bonds. Of course, if you have
other better investment options, this isn't a problem.
Today, I actually bought 100,000 shares of Apple at a price of a little over $176. What I thought most was, is this price for Apple cheap? Would you buy this company at this price? I think the same for Alibaba and Tencent. Many questions can't be answered immediately, but we have time. What factors need to be considered? Of course, all factors.
Setting investment goals is quite a foolish thing. I mean: when you have a target of growing by a certain percentage each year, you will eventually do very foolish things.
On hot topics like new energy, ChatGPT, Pinduoduo
(New energy vehicles) will be much more homogeneous than traditional car companies. It's really hard to say who will survive in ten years. Ten years may not be long enough, but in twenty years, we'll likely know the results.
I'm not very familiar with the automotive industry. My intuition is that making cars differentiated is not easy, but definitely easier than differentiating silicon wafers. In all likelihood, the future survival status of "new energy" car companies will be similar to that of traditional car companies today. Business will be passable but not a particularly good business model.
I didn't look into anything; I just saw Buffett buy twenty-something percent (of Occidental Petroleum). I knew he was serious, so I followed and bought about a million shares. I won't increase my stake or spend time on it, because even spending time, I wouldn't understand it.
However, I understand Buffett, so I follow a bit for fun. It's hard to make big money on this company, but earning a few percent in a year is satisfying.
It's a bit like Buffett buying Activision Blizzard. Buffett just believed Microsoft would buy it, so he bought some. Don't assume Buffett understands Blizzard, and don't ask me what Occidental Petroleum is about. This behavior is simply called arbitrage, with a very small risk of being trapped.
Anyway, ChatGPT is still very much worth paying attention to, although it doesn't seem to work well as a search tool currently. Hopefully, it will push Google to be even stronger.
People's wish for ChatGPT to revolutionize search is somewhat like their wish for fully autonomous driving to be realized, though I also hope they can achieve it.
However, it seems very likely that everyone will have their own AI assistant, significantly increasing efficiency. Google's monopoly will indeed be impacted, and its market share will decline somewhat.
(Zoom and SF Express) are both tough businesses. Businesses with poor business models are still businesses. With good leadership, sometimes a tough business can be done well, but it's hard for investors.
I don't quite understand the business model of Japanese trading companies. It feels like a product of Japanese culture, as I haven't seen successful examples elsewhere. It might be somewhat like the xx trading companies that were everywhere 20-30 years ago? Mr. Buffett might have found an opportunity by looking at the reports.
I've always liked Disney's products but never understood Disney's business model. Why does Disney seem strong but always have a hard time making money? It seems like this business model isn't that wonderful; it's a very exhausting business model. However, I will still keep my investment in Disney, as it's less than 1% of my investments.
I've always found e-commerce hard to understand. I don't know where the moat is and who will still be doing well in ten years. For example, I find it hard to understand why Pinduoduo is so powerful and why Alibaba and others can't or don't imitate it. If everyone follows the powerful things, who will be more powerful in ten years? Apple's things are hard to imitate. There are actually very few things in this world that can't be imitated.
I did buy some things on Temu, which were cheap and usable, but it doesn't help me understand its business model. I can't figure out what the situation will be in ten years or more, so I won't change my view on Pinduoduo because of Temu.
My view on Amazon has always been: retail is hard to make money from, and cloud services will be affected by other big companies. Microsoft, Google, and Apple's cloud services will take a certain market share in the future.
Simply put, I don't have much understanding of e-commerce and currently have no intention of seriously investing in it.
I can't fully grasp Tencent and Alibaba, so I can't invest heavily.
Regarding proximity to the supply chain, when Changhong TV was very popular early on, I once told a friend that Changhong's distance from the supply chain would make its costs much higher than competitors, and in the long term, they wouldn't make it.
Running a business jet company is a bit like an airline, but the differentiation is greater because customers are less price-sensitive, but it's still not a great business model, at least much worse than Apple.
Microsoft's moat is very strong, but unfortunately, I didn't understand it before. I've understood it a bit in the past two years but haven't had the opportunity.
I will never become Buffett; there are many things more important than investing in my life
Buffett's magic comes from his continuous learning and thinking. Passion indeed has great power.
Although I admire and respect Buffett, I will never become Buffett, because that's not the person I want to be. There are many things more important than investing in my life.
So-called business intuition is actually rational thinking ability. Buffett has long been at the top level. Of course, as experience accumulates, the accuracy of intuition about different companies will definitely increase.
I only care about what I can understand. Only those who don't understand ask everywhere: "What do you think?"
Pretending to swim is very dangerous, just like pretending to invest. However, many people don't understand the danger of pretending to invest until they realize the danger.
"Fundamental values" are demands on oneself, not a mirror to criticize others.
Think about who you will eventually become, and it might influence each of your choices a little.
Reading and understanding the Dao are two different things. Reading is learning or a hobby, even a way to pass the time, while understanding the Dao is thinking. Reading might help with thinking but is not a necessary condition. Thinking is a necessary condition for understanding the Dao.
After investing, I found that the proportion of people willing to think is much smaller than I imagined.
Life is not easy; depression is really a bit scary. I occasionally have some persistent uncomfortable thoughts, and my method is to shift my attention quickly.
Playing games is a good way to divert attention, as is listening to appropriate music and exercising (such as golf or swimming). This is just a personal experience.
Sharing is just a hobby, so why call it selfless? Since childhood, I've seen people say "selfless," but is that an expectation of others? Hoping others are "selfless" is actually quite "selfish," right? Anyway, I've never seen a truly "selfless" person in my life.
I actually have no life goals and am not that self-disciplined, often accidentally eating or drinking too much. But I do like focusing on the essence.
I am indeed a very lucky ordinary person who has figured out some lazy ways that might help other ordinary people a bit. Doing the right thing reduces a lot of unnecessary hassle.
Actually, "lazy to move" and "lazy to think" are quite natural, and I am like this myself. However, I like golf, so I often "get moving." I like to thoroughly understand things I am interested in because I enjoy it. So, passion is very important.
I must find time to watch "Forrest Gump" again. I've seen it over a dozen times but haven't watched it in many years. I like this movie because it's a very good historical film, showcasing many segments of history through the eyes of a "small person" like Forrest Gump.
I have no unique education methods! How can paying more attention and trusting your children be considered unique education methods? Isn't that bizarre? What kind of children would lack of attention and trust raise?
Who cares what mistakes a person running on the wrong path makes? The outcome is determined from the start.
Correcting mistakes quickly, no matter the cost, is always the least costly option. Correcting a mistake is good, and correcting it a second time is also good.