Duan Yongping is one of the best entrepreneurs in China, and the OPPO and vivo brands he founded have become one of the best-known mobile phone brands in China.

He is also an independent investor, and more than 90% of his personal wealth comes from investment. In 2001, Duan Yongping bought a large number of NetEase, Inc shares at a price of about US $1, making a maximum profit of a hundredfold. When the share prices of Apple Inc and Maotai were very depressed, Duan Yongping also bought heavily and achieved an amazing return on investment.

Recently, Duan Yongping made a rare voice in a post aimed at Apple Inc Company:

In these days of panic everywhere, think about what good companies will look like 10 years from now.

I am not afraid of the epidemic at all. It is the same in terms of investment and health. In fact, there are already good opportunities for investment.

Apple Inc's share price hit an all-time high of $327 in February and has fallen back to around $240, a correction of 26 per cent.

Needless to say, Apple Inc's "moat" in the field of consumer electronics has also been growing steadily in recent years. Revenue in the first quarter of fiscal 2020 reached $91.8 billion, exceeding the previous upper limit of $89.5 billion, up 9% from a year earlier, and net profit was $22.2 billion, up 11% from a year earlier.

Although affected by the epidemic, Apple Inc's mobile phone sales will decline in the short term, but Apple Inc's balance sheet is very healthy and has a huge amount of cash on his books. This may be what makes Duan Yongping think that Apple Inc is still a "good company".

Duan Yongping rarely talks about investment in public, but he often communicates with "fans" on his blog. Before that, the media combed his investment ideas, and now they are displayed as follows for your reference:

First, do not short, do not borrow money, do not do things you do not understand

To be honest, I don't know who is suitable for investment. But I know that statistically about 80-90% of people who enter the stock market lose money. If the interest is taken into account, the loss rate is even higher. The reason why many people want to invest may be that they think that the money they invest is easier to earn or come faster.

As a person with both business operation and investment experience,Personally, I think it is easier to run a business than to invest.Although there is no essential difference between the two, running a business always has little chance of making mistakes in areas that you are familiar with, while investment always needs to face a lot of new things and uncertainties, and investors can easily become speculators. in order to take risks that should not be taken, and speculators may take much longer to turn into real investors.

Investment and speculation are actually very different games, but they look very similar.Just like in Macau, casinos are run by investors and gamblers are speculators.The reason why casinos always have a steady stream of customers is that there are always gamblers who can win money, and those who win money are always louder. As entertainment, there is nothing wrong with betting on a little money, but gambling is wrong. But I can really meet a lot of people who gamble on the stock market.

From my personal point of view, anyone can make an investment, as long as you know what you are buying and where the value is. Speculative skills may be much higher, this is an area I don't know much about, and I'm not going to learn it. Spend more time with your family or play a few rounds of golf when you have time.

Even the person who claims to have a lot of enterprise experience feels that he has a better understanding of investment after going through a lot of setbacks. I asked Buffett what he couldn't do in his investment, and he told me:"Don't short, don't borrow money, the most important thing is not to do what you don't understand. "

Over the years, I have lost hundreds of millions of dollars in my investments, each of which goes against the old bus's teachings, and the big money I earn is made in places I really know. As a student who has just started out, he may know a lot about the things in the book, but he still needs to suffer a lot of losses when he melts into his bones. So, if you get into the investment industry right away, the most important thing is to be conservative and don't get up because of one mistake. The only thing I can guarantee here is that you are bound to make mistakes.

The most important thing to invest is to invest in what you really know.The subtext of this sentence is to put it where you really think it will make money. My definition of making money is that the return is higher than that of long-term risk-free bonds. Whether a person knows whether a company can make money or not has nothing to do with his education. Although people with high academic qualifications generally have better learning abilities, the school does not teach them how to invest, because it is very difficult for those who really know how to invest to teach in the school, otherwise investment masters would be professors. However, you can learn a lot of the most basic things in school, such as how to do financial analysis, which will be very helpful in understanding investment goals.

Regardless of educational background, one will always know something, and what you know may one day allow you to find opportunities. The opportunity I seized by myself doesn't seem to have anything to do with education.

For example, we can earn more than 100 times on NetEase, Inc because I had a lot of understanding of games when I was a bully. This understanding will not be taught in schools, it is not in books, and it can not be seen in financial reports. I also tried to tell others my understanding, but I found it very difficult. For example, I dared to buy GE because as a business operator, we followed GE's corporate culture for many years. I thought GE was a great company from the bottom of my heart.

What I mean by "anyone can invest" means that I don't think there is a definition of "only 'certain people' can invest". But the proportion of people who are suitable for investment should be very small. Perhaps it is because the principle of investment is too simple, and simple things are often the most difficult. By the way, what is the "simple"investment" principle: when you buy a stock, you are buying this company! Is it easy? Is it difficult?

I would like to briefly write down my current basic understanding of investment:

1. To buy stock is to buy a company. Therefore, there is no difference whether the company bought at the same price is a listed company, listing only gives the convenience of exit.

2. The discount of the company's future cash flow is the intrinsic value of the company. You should buy shares when the company's share price is lower than its intrinsic value. Whether it should be 40% or 50% (margin of safety) or other figures is entirely determined by the investor's own opportunity cost.

3. The discount of future cash flow is not an algorithm, but a way of thinking. Don't try to work it out with a calculator. Of course, it's okay to do the math with a calculator.

4. Not knowing and not doing (ability circle) is a necessary premise (not sufficient) for a person to judge the intrinsic value of a company.

5. "moat" is an important means (not the only one) to judge the intrinsic value of a company.

6. Corporate culture is an important part of the moat. It is hard to imagine that a company without a strong corporate culture can have a wide moat.

It is very important to "rationally" face the daily fluctuations of the market and carefully examine each of your own investment reasons and their changes. It seems that my understanding of investment is that simple. But this "simplicity" is actually not too simple, in fact, this simplicity is actually censured.

There are a lot of questions about valuation here, so talk about your thoughts briefly. Personally, I think it's better not to invest if you need a calculator to work out such a profitable investment in half a day. I thinkValuation is a gross estimate, and it's not cheap enough if you need a calculator to figure it out.

As Munger said, I've never seen Buffett value a company with a calculator, and I don't seem to have really used a calculator to value a company. I always think that the general valuation is mainly used to judge the downward space, and the qualitative analysis is the source of the real profit, which is probably the most difficult thing in the value investment.

Generally speaking, stocks that earn dozens of times or more are never estimated by valuation, otherwise it makes no sense for investors not to bet on them all at first (if I had known that NetEase would rise 160 times at that time, I didn't buy it all). ).

It is precisely because there are so many uncertainties in qualitative analysis that in most cases people do not dare to make big bets even if they are optimistic, or do not dare to go all out even if they make big bets. Of course, there are times when you feel cheap by pressing the calculator, such as Petrochina Company Limited bought by Buffett and Vanke I bought. But this situation is often a special case.

Buffett did say that great companies and businesses don't need to be sold, but there are very few companies he hasn't sold so far. In addition, I think Buffett's subtext is that great corporate markets often don't give a crazy price, and if you sell just because you're a little overvalued, you may lose the opportunity to buy it back. Moreover, in the United States, investment pays profits tax, and if you don't sell it, you won't make a profit. Once you sell it, you may have to pay a very high tax, which is not cost-effective.

Whenever you sell it, don't associate it with the cost of buying.There may be many reasons why it should be sold, and the only reason that should not be used is "I have made money".Otherwise, it will be easy to sell a good company that is not easy to find at a low price (and not to sell what should be sold when you lose money.) It's the same when I buy it. There are many reasons to buy, but what price this stock has reached had better not be used as a reason for you to buy.

My standard of judgment is value. This is why I can hold NetEase, Inc for 8-9 years. At first, I bought NetEase, Inc at an average price of about 1 yuan (equivalent to 0.25 yuan now), and most of the selling prices were about 30-35 (current price). During these 8 to 9 years of holding, I may have been seduced by the selling price every day, and I used this reason to resist the temptation (in fact, I have bought and sold some in the middle, but a small part of it. (the reason I sell is that I need to change GE and Yahoo. I will keep some NetEase, Inc shares all the time. Buffett's things can be learned by everyone, of course, only a few people can learn. In fact, I find that only a few people will really learn seriously, so it is easy to understand that few people can learn.

What Buffett opposes is completely different from the derivatives he makes. I use a lot of financial derivatives myself, just like Buffett, so I understand what he's talking about. It is difficult to explain in one sentence, but it can be illustrated by an example that is easy to understand.Many people use derivatives as if they were gamblers in casinos, hoping to make money quickly. Buffett's use of derivatives is like opening a casino in Macau, which is profitable in the long run.Not everyone can make money running a casino, but someone who can run a casino can. The casino example may not be appropriate, but the truth is the same.

Speculation is not without me, but it's just for fun, just for fun, just for fun. When people want to discuss stocks with me, I have to make it clear that they are talking about speculation or investment. Is it for fun or for money? If for fun has nothing to discuss, just buy what you like. You won't sell the house and carry the money to Las Vegas anyway. I once spent two hundred yuan on a cruise for three nights and made two thousand yuan. If your story as an investment increases tenfold in three days, what kind of story is it?! But do you dare to bet millions on it? I dare not.

So investment is another way of saying.

I have invested in at most five or six companies from beginning to end, and I have sold some of them. I usually own about three companies. Buffett's Hathaway has a market capitalization of more than 100 billion US dollars and only about a dozen investors.I am not afraid of concentration, I am not ordinary concentration, I am absolutely concentrated.

Second, invest in GE and excellent corporate culture

I have been saying that I have the opportunity to give some examples of myself here, but I don't know which one to talk about. In fact, I have touched a lot of stocks over the years. I have lost money and made money, but none of them felt 100% that I could make a lot of money from the beginning. No matter which one I buy, I feel a little uneasy in my heart. I think GE may have my own characteristics.

When I first started running a business, my favorite was probably Panasonic. Later, I was a little disappointed with Panasonic, especially after visiting Panasonic headquarters in Osaka, I really felt that Panasonic had some problems, and slowly I didn't mention Panasonic any more. Around that time (before going to Panasonic), we began to reflect more and more on ourselves, hoping to build and strengthen our own corporate culture. At that time, I seemed to be studying for an EMBA in CEIBS and introduced some courses from CEIBS into the company at the same time.

The book that impressed me most during that time was GE's last autobiography written by CEO Welch. In that book, I saw the powerful role of corporate culture in building a good company, and was extremely impressed by the strong corporate culture of GE. Later, I read Welch's later book "win" to learn more about how they built their corporate culture.

Since then, I have also spent a lot of time understanding and thinking about GE. Think about why GE is a century-old store, why the board of directors of GE can always choose a good CEO, why there are more than 170 CEO in the Fortune 500 from GE and so on. I actually noticed GE's stock at that time and thought that GE's stock price was not cheap at that time (it seems to be around 40%), so I didn't care about his stock price anymore.

Since the collapse of Lehman in September 2008, the impact of the financial crisis has become more and more serious, and the whole market has become jittery. When I saw the panic in the whole market getting worse in November, I thought, maybe this is Buffett's "fear" coming, and it's my turn to be greedy.

At the beginning, I didn't have a very clear goal. I just felt that the market was full of bargains, but I didn't know which one was safe, as if every company had a big problem and every company might go bankrupt. What I thought most about at that time was how to mobilize all the resources I had to seize this once-in-a-lifetime opportunity.

By February, GE had broken 10 yuan. At that time, many companies related to subprime mortgages, such as Lehman and AIG,Citigroup, had gone bankrupt or were on the verge of bankruptcy, and there was more and more negative news about GE. Many people on Wall Street were saying that GE would be the next Lehman.

I know that GE used to have a profit of more than two yuan per share in good times, and even if it is close to it in the future, it will be more than 1.50 yuan per share after the crisis is over. If I give him a 12-15 times PE, it should be more than 20 yuan anyway. So, when the ge reached about 10 yuan, I already started to buy some, but I haven't made up my mind to buy it. Until one day when GE fell to around $9, I saw a speech from JeffImmelt. I forgot what the original words said, which basically means that he thinks GE's image has been damaged, and it's all his fault. GE will restructure its business over the next few years to reduce the proportion of finance companies to less than 30 per cent of the company. He also reiterated that GE as a whole is safe and healthy, and so on.

Of all the companies with problems at that time, it seemed that I only saw GE come out to admit their mistakes and review their countermeasures. This is probably the difference in corporate culture, right?

GE is a huge company, and I have tried to see what kind of business GE has and to analyze the pros and cons of all his business models, but I found it very difficult. I can see some very good patterns, as well as some bad ones.

In the end, the decisive factor that made me decide to play a big role is my understanding of GE corporate culture. I don't think the financial crisis will destroy GE's strong corporate culture. GE's problems are only caused by past strategic mistakes that can be corrected over time. The mistakes of great companies are often the investment opportunities of a lifetime.

It is easy to figure out what will happen in the future. For a period of time, I was busy buying GE almost every day, constantly trying to mobilize resources, from about 9 yuan to 6 yuan to more than 10 yuan, as if I bought some money after 12-3 yuan (some money was later transferred from other stocks). It didn't stop until the stock price of GE was higher than that of Yahoo. At that time, I had the idea of using margin, but later I felt that the principle of not doing what was wrong could not be broken, so forget it.

In retrospect, among the stocks I bought last year, GE did not have the biggest increase, but it was indeed the stock that I sold the most, made the most profit and worried the least.The reason can only be said that my understanding of GE corporate culture finally helped me to make a very important decision.Maybe it's just luck?

In fact, when I bought Vanke and Skyworth, I seemed to have a similar feeling. Skyworth and we are colleagues, and we still know more or less about their company.

Due to institutional factors, I have always thought that Skyworth is the healthiest enterprise in China's color TV industry. Although something happened at that time, the most basic things of the company did not change. When we bought Skyworth, Skyworth seemed to have a market capitalization of less than 2 billion (I don't remember, some in my early 20s). I thought it was cheap, so I bought it. We stopped when we bought 10,000 to 5% of the shares, because the next purchase would be announced, so we really wanted to communicate with Huang Hongsheng before the announcement, for fear that people would think that I was going to rob the third mu of land, hehe. As a result, we didn't buy any more because it was inconvenient at that time. I didn't get on the phone with Boss Huang until two weeks ago, saying thank you and saying hello.

As far as Skyworth is concerned, I don't have a clear idea of how much it is worth, and I don't know much about their current business situation, so they have been reducing their holdings one after another since they rose, and now there may be less than 20% of their maximum holdings. I think the people who buy it now may know the value of Skyworth better than I do, and they should be able to earn the rest of the money.

Closing positions for 10 years is a good idea, and that's what you should think when choosing stocks.But I don't know if I will hold Apple Inc for 10 years or more. In fact, when I bought the stock, I really didn't think about how many years it would take. I usually set an approximate price for the stock I buy. For example, when I buy GE, I think GE is worth at least 20 yuan, but I really don't think it will take many years to arrive.

Third, invest in Apple Inc, invest in excellent business model

Apple Inc's industry is indeed a fast-changing industry. Although I think Apple Inc is already in a very favorable position in the competition, I am still very concerned about what changes may change Apple Inc's position. If I have to set a price for Apple Inc, I probably think Apple Inc may reach 600 yuan one day.

The reason is: as far as I understand it, Apple Inc's profit will probably reach 40-50 yuan per share in two to three years (the current profitability is about 25-6 yuan per share per year), that is to say, Apple Inc's profitability will be close to double in two or three years, plus more than 100 yuan per share in cash at that time (now about 60 yuan per share), is it not too much to give him a 600 price? Of course, Apple Inc is also likely to fall back to more than 100 yuan, anyway, everyone will know by then.

The first big investment decision this year was to buy Apple Inc on January 21, putting in all the money he earned last year. From a long time ago, I began to care about Apple Inc more or less, but I didn't analyze it carefully, probably because I was always full. 1.21 due to the equity maturity date, a lot of funds have to be released, and suddenly figured it out under pressure.

The inspiration for buying Apple Inc actually comes from a question from a blogger. I remember that some time ago I used Apple Inc to give an example of what the stock price is cheap: if you think an apple is worth 500 billion, then 300 billion is cheap, even though it used to have a market capitalization of only 5 billion. In fact, I personally think that Apple Inc may be the first company on earth with an annual profit of more than 50 billion US dollars. Maybe Apple Inc will be the first company with a market capitalization of more than a trillion dollars (depending on how crazy the market can be).

Tell me some reasons why I like Apple Inc. This is not a paper. If you think of it, you will say that there is no focus and order.

1. Apple Inc's products do take the user experience or consumer orientation to the extreme, and it is difficult for competitors to surpass or even approach (for favorite users) for quite a long time.

two。 Apple Inc's platform has been established, or a business model or moat has been formed (software alone earns billions of dollars a year).

3. Apple Inc's single-product model is actually the highest in our industry, and I've probably only seen Nintendo do it before (sony's game products are similar). The single-product model has many benefits:

a. Can concentrate manpower and material resources to make the product better. Compare the iphone series with the Nokia series (40 varieties will be launched this year). The unit development cost of Apple Inc's product is very low, but the development cost of a single product is the highest.

b. The material cost is low and the quality is good, and the benefit brought by large scale. Apple Inc's cost control is also extreme. I'm afraid no one can reach Apple Inc's cost with the same function of hardware.

c. The channel cost is low. Hehe, those who are not in the same trade may not be able to understand the weight of this words (nor do they). I learned it from Nintendo 20 years ago. At that time, many people who made video games liked to do many kinds of games, but they didn't end up very well in the end.

4. Apple Inc's marketing is also extreme, even the advertising fees are much lower than their peers, but the selling price is often very good.

5. Apple Inc's products are in a huge and growing market.

a. How big is the smartphone market? You know!

How big is the b.pad market? You'll understand, too.

All in all, I think Apple Inc is actually still in the early stages of his growth, so there should be a lot of room for him. If you deduct the cash, Apple Inc's future pe this year is only 12-13 times, and next year it may be less than 10. Of course, any change in any of the above points may change Apple Inc more or less. If you have Apple Inc's stock, you should pay attention to these changes. The only thing I can think about is the future free cash flow. However, it is not easy to think that Apple Inc can do this, and I regret that I have not made any effort to think about it before.

I think if Jobs really takes a long vacation, it won't have a big impact on Apple Inc's business for quite a long time. In the long run, Apple Inc without jobs may slowly become the same company as other peers. But Apple Inc's platform has been set up, just like the three major battles have been fought in that year, the impact of jobs is not great.

Apple also has many advantages, such as: single variety, so high efficiency, good quality consistency, low cost, good inventory management and so on. I have been pursuing a single variety since I was a bully, especially aware of the benefits and difficulties of being single. Not many people in this industry understand this and consciously do it, and we can't do it at all now. Compare Nokia and you can immediately understand the benefits and difficulties of a single breed. Nokia needs a lot of varieties to be consumer-oriented, while Apple Inc can do it with one variety, which is a lot worse.

To make products and markets, we often like many kinds of products, and the benefits are used in different market segments to attack competitors' varieties. The downside is to build a lot of inventory, the quality is not easy to control. A single variety requires good skills-to make the product the best. It's hard. Because of the difficulty, most people like to have many varieties. Like investment, value investment is simple, but not easy. Making fluctuations is often very attractive.

Apple Inc now has 60 billion in cash and made a profit of 6 billion in the fourth quarter of last year. If Apple Inc achieves an annual profit of more than 50 billion, a market capitalization of more than 500 billion is very reasonable. 1 trillion is just a statement, which depends on the follow-up development of Apple Inc.

Before I decided to buy Apple Inc, I mainly thought about whether they could still grow, how much room they had to grow, where the threats might come from, and so on. Instead of thinking about his stock price now and in the past, I try to look at the company with a normal mind. From my point of view, it is possible for Apple Inc's annual profit to reach 80 billion or more one day, so I think the price I bought is still very cheap.

Apple Inc's rising space is of course far less than that of NetEase, Inc, but NetEase, Inc at that time is impossible to find, and even if it happens now, it will not be of much help to me. Does a company like Apple Inc still want to visit the company? What can you see? I just suddenly remembered that somehow wanted to take a closer look at Apple Inc. I always thought Jobs was too powerful and a time teller, but then I suddenly realized that its implementation was no longer so important to him, at least in the next few years. After all, we are colleagues, although the gap is still large, but some things are easy to understand.

Fourth, focus on investment, quantitative analysis, buy cheap companies

Buffett has said that he has been concentrated many times in his life, even reaching 100%. Run into one is one, anyway, you don't need to have many goals to make money (Buffett says one idea a year is enough). Sometimes the target you are interested in will jump right in front of you. If you have only one stock and it is full, if you really know what you are investing in, then the decline has nothing to do with you.

It is better to have money in hand when there is no goal than to lose money at random. If you invest indiscriminately as soon as you have money, you will encounter the goal of losing a lot of money sooner or later. If you have the right stock, you will buy it, and if you don't, you will be idle. Eggs can look better in one basket.

In fact, there are very few things I know. I knew Buffett had a good way to Rome, but there were always a lot of friends asking me about Soros, and I was not allowed to say I didn't know. I really don't know. Generally speaking, if you get a good shot, you have to be ruthless. It's hard to fight hard if you don't understand. There is always a chance to wait patiently.

You don't have to buy stocks with reasonable prices. My view is that the opportunity is only when the price is not reasonable. Sometimes it can be hard to wait, especially in a big bull market.Buffett said, the hardest thing is to do nothing. Ha ha, he finds it difficult, so it's normal for us to find it difficult.

Of course, it is necessary to do quantitative analysis when buying stocks.. For example, if a company has a net worth of 10 billion yuan and earns 1 billion yuan a year, how much is the company worth? It is probably that you can get 1 billion interest on your X deposit (interest on long-term treasury bonds), and then discount x by 40%.

If the income from buying 20 billion long-term treasury bonds is 1 billion / year, will I spend 20 billion to buy a company with an annual interest of 1 billion? The national debt is riskfree (risk-free), so you have to give a discount to buy a company. The more I feel that the more ridiculous the discount is, the more serious it will be, which is no different from our usual business. This is probably the source of Buffett's margin of safety. Long-term interest rates change, so I usually use a fixed 5%.

Enterprise value is discounted future cash flow. This thing of the future is a little blurry. In popular terms, let's not talk about the discount rate. Suppose I know exactly the future of this enterprise. The value of the enterprise = shareholders' equity + the sum of net profit in the next 20 years. And then discount it. That's probably what it means, just make a gross estimate. This algorithm actually takes into account growth, if you can see it (this part is a little difficult).

If the PE of the company you buy is 10, even if it is delisted, it will make a profit of 10% a year (without taking into account the company's growth). Profits, whether used to pay dividends or investments, are much higher than national debt. Is this analysis correct? The problem is that PE is historical data. If you believe in him, there must be 10% in the future. The convertible bonds of Goldman Sachs Group and GE that Buffett bought is 10% plus option, a very good deal.

I do use more qualitative analysis in investments, which is the difference between me and Wall Street analysts, otherwise how can I have the opportunity to simply look at the numbers, unless there is more net cash on paper than stock price. Pe=10 means that it will take 10 years to earn back the stock price, and if you want to buy it, you have to think that the average annual profit within 10 years will reach or exceed the current annual profit. In my eyes, Shanda seems to be running out of steam.

My general goal is to buy what I think is undervalued by 50% or more, and the value should be the discount of current net worth plus the sum of future profits.

The secret of Baoba's success is that he knows what he bought.In the final analysis, to buy stocks is to buy companies. No matter what you understand is long-term or changing, as long as you really understand it, it is a good opportunity when it is cheap.I sometimes say: investment is very simple, don't know how to do it. But to be able to understand the enterprise, even reading a ton of books is not necessarily good, the investment is simple but not easy!

I very much agree that DCF (discounted total cash flows in life cycle) is the only logical valuation method. In fact, this means "to buy a stock is to buy a company", but it is quantified.When I think about investment, I always think that there is only one thing that is the simplest, that is, when you buy a stock, you must think that you are buying the company, and you may hold it for 10 or 20 years.

My so-called valuations are all estimated by Mao. When I bought Vanke, the market capitalization of Vanke was only more than 10 billion yuan, and I thought it was more than that anyway, so I casually gave it 50 billion. Hehe, the only thing that was certain at that time was that more than 10 billion yuan was a bit too cheap. If someone sold me more than 10 billion yuan of Vanke, I would be happy to buy it, so I would be happy to buy some of it.

Buffett once said: a fat man of 300 jin came in. I knew he was fat without a scale. When I bought NetEase, Inc, I really didn't make a serious "valuation". The calculated value was only related to the total discounted cash flow in the future.In fact, net worth is only one of the factors that generate future cash flow, so I coined the term "effective net assets". That is to say,Net assets that do not generate cash flow actually have no value (and sometimes negative value).

If this is an arithmetic problem: that is, it must earn 100 million yuan (net cash flow) every year, and assuming that the bank interest will never change, say 5%, then I think the intrinsic value of the company is 2 billion. Interestingly, the surface seems to have nothing to do with how much net worth. In fact, net worth is one of the conditions for realizing profits.

Unprofitable net worth is sometimes an encumbrance. For example, it cost 100 million yuan to build a hotel in an uninhabited place, but now it loses 500w a year. The replacement cost is still 100 million. Now 5000w wants to sell. Who wants it here?

What we should be careful about is that velocity in general economics is actually the concept of acceleration in physics, and velocity in physics is the concept of total quantity in economics. So the growth rate equals zero means that the acceleration in physics is zero, but the total economic output remains the same.

To give an example: a company with 100 billion net worth earns 5 billion yuan a year, growing to zero; another company has 10 billion net assets, earning 500 million this year, an increase of 8% / year. Will the gap between the strength of the two companies widen or narrow 20 years later? The problem is that 20 years later, what if the growth of both companies becomes zero?

Discounted future cash flow is not a formula, it's just a way of thinking. I have never seen anyone who can really calculate that a company will have discounted cash flow in the future. Munger said he had never seen Buffett count as this thing. In fact, it is still a problem of discounted future cash flow.

Munger reminded Buffett that the future cash flow of growing companies is better discounted than cigarette butts.Bab found that the discounted future cash flow of "bargains" is even smaller than that of companies that are sure of growth, which may be the role of Munger's reminder.However, it is much more difficult to understand a good growth company than to pick up bargains.

It is difficult to find an undervalued company itself. The most basic concept of my investment comes from Mark's "price fluctuates up and down around value". The value is that the The Whole Life of this company can make money discounted to this day, and the price is the thing that is too high or too low in the market. How to evaluate whether an enterprise is undervalued, I think the team is of course important, and it also depends on whether your company has a good culture. The real core competitiveness of an enterprise is corporate culture.

Fifth, do your duty to buy what you know

I don't know. I don't know. I still don't fully understand where the risks of the bank's business are. Some big banks in the United States have a major upheaval every 10 or 8 years, and they still don't understand what's going on. Soros is not easy to learn, at least it is difficult for ordinary people like me to learn. Lao Ba's things are easy to learn, understand immediately, do not understand look at the top sentence.

Buffett has a lot of insurance and financial investments, I basically do not, because I do not understand, always feel insecure. I invested in some companies related to internet, but Buffett didn't, because he didn't understand. He thinks Coca-Cola Company is something people must drink, and I think games are something people must play. The airline had better not touch it. The products of airlines are difficult to differentiate, can not make money, and have no investment value in the long run. Buffett taught me this and saved me a lot of money.

I bought it cheaply. If you don't believe the bus, who else can you trust? I seldom take a closer look at the reports of the companies I think I really know, but I will read them before (or at least should). I usually understand the corporate culture first. If I don't trust the company, I won't even read the report.

I just do what I think I can understand (if I think I know it, I don't necessarily know it), and some of it may just be what people call technology stocks. I can't tell what technology stocks are. If anyone wants to buy it, he must know what he is doing, or you won't sleep well. In fact, when I say that a stock has investment value, I most hope that someone will challenge rather than follow up. I want to see a different point of view. My investment is not limited to a certain market, mainly depends on whether I have the opportunity to understand.

If A shares have cheap stocks that I know well, I can also buy them. But now I don't know much about A-shares. If you had understood Buffett at that time, you would have been rich. If you don't understand now, you will miss a lot of opportunities. There are often many reasons to buy a stock. One or two reasons are often enough not to buy. When buying stocks, value investors always assume whether I will buy the whole company if I have enough money.

Someone asked Munger if there was only one word to describe their success. His answer is: "rationality" (rational), hehe, it's a bit like what we call an ordinary mind. The problem is that not using spare money will have a negative impact on life. I always use my spare money. Actually, so is Bud. At least you can have a normal mind if you have an attitude of using spare money, otherwise you won't be able to sleep.

I don't think it's that much of a test for so-called value investors. In other words, they don't buy anything that is suitable, and then buy it when they have the right thing, just like most people go shopping. I don't think everyone will aim to spend all their money when they go to the mall. My advice is to take your time. Slow is fast.

My understanding is not to do what is not my duty.In fact, the so-called duty mainly refers to the values and the scope of ability. How much money I make is not decided by me, it is given by the market. Hehe, it's up to man to think of things, and heaven to get things done. Ha ha, if you earn a share of the money, you will sleep well. If you are in good health, you will live a long life, and you will make a lot of money in the end. The most important thing is that people who don't make money are actually unhappy.

Don't gamble, it's okay to open a casino

About the market:Oh, again, I think bottoming is a speculative concept.The eyes are fixed on others. Value investors only look at the target of investment and should not look at others. However, as an investor, I think we should have a good understanding of macro-economy, or at least general economic phenomena.

I personally think that it is very difficult for most funds to really invest in value, mainly because of the structure of the fund. As funds are often measured by years, investors often decide whether or not to invest based on their performance in the previous year. So what we often see is that when it is most appropriate to buy stocks, many funds will sell furiously in the market because shareholders are very panicked and want to redeem them. But often when the stock price is very high, there are a lot of funds buying crazily, because at this time there are often a lot of shareholders willing to invest money. Most of the funds collect annual fees, and they always want to do something when they are rich, otherwise shareholders may have an opinion.

Don't want to go to the casino to win money, but it's okay to open a casino to make money.I sell puts just like what he does. Speculation is addictive and hard to change. This is what Munger said. Buffett no longer looks at the picture and the line. Look at the picture, look at the line, it's easy to miss the opportunity. In fact, everyone has a chance to learn from Buffett, but most people just refuse, alas.

Most people will not change. Besides, this practice does not necessarily lose money, it is the opportunity cost, so it is not easy to understand. I have seen people with strong trends who have been doing it for decades, but they are still "small funds". Think about it with Munger's "reverse thinking" and you may be less interested in "trends". In fact, speculation is much more difficult to learn than investment, but speculation is exciting and fun, so most people still like speculation.

I think when a person thinks he can beat the index, he may have lost his normal mind. I think there is no comparison in the hearts of investors with good value. But the result is often that good value investors beat the index in the end. Investing anywhere is really the same, and it will be troublesome if you don't seriously understand what you are investing in.

Value investment is cheap or not, no matter what other people think, find a good company you know, and don't care too much about anything else.

I don't know when it will sell. Anyway, you can sell it when it's not cheap, if your money has a better place to go. By the way, I personally think that bottoming is a speculative concept, and value investors should not seek bottoming. Bottoming is looking at others, while value investors just sell when they are cheap enough (no matter what others think).

For me, if I copy the bottom of a stock, the profit is often less, because the rebound is often unable to do so, so it is easy to lose the opportunity. The most typical example is that when we bought Vanke, we copied it to the end, depressed (actually not so depressed, better than losing money), and bought far less than we had planned.

The judgment of the market is very simple. If you have enough money to buy all the stocks and earn all the money earned by listed companies, if you think it is right, then the market is not expensive, otherwise it will be expensive. (transaction fees are not included here.) dividend sharing has nothing to do with whether there is investment value or not. If you think that the company's earnings per share can be higher than the long-term bond interest rate for a long time, the company may of course become an investment target. Whether you vote or not depends on whether you have a better goal.

In fact, when I bought it, I didn't consider whether someone bought it from me. I have to assume that if this is not a listed company, I will still buy it at this price. If you understand this, you will have the most basic concept of value investment, and vice versa. You can't rely on PE alone to speculate about the company's future earnings, or you will be hit. For example, the PE of GM (General Motors Co) has always been very low (it used to be about 5 times), but the debt was so high that it went bankrupt. If you can think about whether a private company has value (or whether it can be reflected), you may be able to understand the question you want to ask.

It is better to be vague and precise than precise, hehe, is that what Lao Ba said? Bobby still made it clear! I think that's what Mao Quan meant. Many people's valuations are a bit precise and vague. Mao estimates. It means that something that can be understood in five minutes must be cheap enough. I have only one standard, that is, I buy it when I think it is cheap. For example, I think the GE value is 20. I may not start buying a little until 15, but it is much heavier when it is less than 10 yuan. It's a bit of luck to buy cheap stocks in heavy positions. It seems more difficult to keep an eye on the stock market every day.

Looking at the financial report is mainly used to exclude the company

I don't read the financial reports very often (so I don't work hard without Buffett. The numbers that I care about are: liabilities, net cash, cash flow, reasonable expenses, real profits, net assets after deducting goodwill, which seem to be gone.

I read the financial report is mainly used to exclude the company, that is to say, if you don't like it or don't understand it, you won't read it. The reasons for the decision to invest are often other factors.。

Intangible assets can also be discounted, so I do not recommend considering intangible assets separately, because the company's profitability is already included. It's not that it doesn't count, but that it can't be actuarial. As soon as I do the math, I think cheap is cheap. For example, how did I calculate when I bought GE: when GE fell below 10 yuan (the minimum was 6 yuan), I thought GE could earn about two yuan when he was good. As long as the economy returned to normal, why didn't he earn more than one yuan? Since ge's rating will still be very high in the long run, assuming he can earn 1.50, wouldn't it be more than 20 to give him a 15-fold pe? That's what I thought at the time. Is it simple?

In fact, there is not a very simple thing behind is that I can firmly believe that GE is a good company (Great company), a good company has a good chance of coming back after making a mistake. Actually, it's a lot bigger than I can count, but it's not easy to know how to believe it. (my target price for GE at that time was 20 yuan, so I sold some after 20, and recently sold some more.)

Warren Buffett has recommended several books to shareholders, one of which is the autobiography of Jack Welch. If you read that book, you will find that Welch is very concerned about corporate culture, so you can imagine that Buffett cares about it, too. He doesn't just look at financial statements, as some people say. Just look at the financial report and you will only see the history of a company. I don't read the financial report so carefully, but I find a professional to read it. After others read it, give me a conclusion. It will be OK for me. But I care about what is made up of profit and cost, and you need to know what it really reflects. And you have to look at the data for several quarters or even years in a row. If you follow a company for a long time, you will know whether it is lying or telling the truth.

Many companies seem to be making a lot of money, but their cash flow is decreasing all the time. Then it's dangerous. In fact, Buffett has said that people know it, but they will be confused when they invest. Many people call themselves investment, but I say they are just for fun, they care about whether others are satisfied (this company), the real investor is absolutely "defiant", his mind is focused on this enterprise, he does not see if anyone around to buy, he had better hope that others do not buy. Similarly, if I am a listed company, I also ignore them, what should I do, the stock price has nothing to do with me.

So when I bought a company, I had a big distinguishing factor, that is, how relevant is the behavior of the company to the influence of Wall Street on him? The greater the correlation, the less likely I am to buy him. There is nothing wrong with Wall Street. Wall Street is always right. It always represents the opinions of different people. But you have to know what you're doing. If you don't have a mind of your own, you have to listen to Wall Street, and you're in a mess.

My logic is Buffett's logic, and there is no difference in principle. The difference is that the industry he is familiar with is not the industry I am familiar with, so the stock he invests is not what I want to invest in. Last year he invested in a company, but I didn't understand it for a long time. Sure enough, after he invested, the stock may have risen by 50% or 60%. When I was asked if I was in a hurry, I said I was in no hurry. Why? Because it's not the money I can make.

On the other hand, for example, if I invest in a company like NetEase, it is not for him to make money. For example, Buffett didn't buy the Google. Because he doesn't know about the business and doesn't understand that it's normal not to make money, there's nothing to regret. If you dare to vote even if you don't know it, first, you can't keep it for that long. If you buy it for 80 yuan, you may sell it for 100 yuan or 120 yuan. In fact, you can't make any money. Secondly, if you do this everywhere, you may already lose all your money. It is precisely because you do not make money in industries and enterprises that you are not familiar with, it shows that you have made fewer mistakes.

Many of my successful investments seem to have no boundaries at all, but they are relevant to me because I can understand it, know whether the management is talking nonsense, whether the enterprise has a good mechanism, whether the competitor is much better than him, and where he will win in three or five years. It's just these things. If you understand it, you vote.

For example, I once earned Panasonic stock. I bought it for 7 yuan and sold it for more than 20 yuan. I kept it for about two or three years. Just because I am in this line of work, many of the ideas of my business come from Panasonic. I have also visited their company, and I know their shortcomings and advantages. I think this company can no longer be less than 7 yuan. And 20 yuan makes me feel that I can buy or sell. So, the investments you make have a lot to do with your past experience, and what you can understand has a lot to do with it. Your judgment has nothing to do with the mainstream judgment of the market, there may be a big time difference between the two. What I judge is its future, and the market will not reflect the price until the enterprise is in good condition.

The growth rate doesn't mean anything to me. In my opinion, the definition of investment is to own part or all of a company, and the simplest concept is "ownership". Suppose a company earned one yuan per share last year and two yuan this year, with a growth rate of 100 percent. Some people say that it may rise again next year. What about the year after next? I don't know the year after next. If you bought the company with your own money, would you buy it? You said that as long as someone bought my stock behind, you would buy it. It's called speculation.

I have the simplest measure of the difference between investment and speculation. I didn't notice if Buffett said the same thing, that is, at the current price, would you buy this company if it is not a listed company? If you decide to buy it back, it's called investment; if you don't buy an unlisted company, it's called speculation.

Just like why I bought NetEase, Inc at that price, I was able to buy (so much) at that price. Because NASDAQ has a regulation that stocks under one yuan will be off the market for more than how long, so many people are afraid of going off the market, so they sell the shares. It was sold under a dollar. Because they are afraid of going off the market. You know why I'm not afraid? That's why I invest. I buy it has nothing to do with whether it is on the market or not. I will buy it if its price is lower than its value. Bubugao never went to market, but I sold the company because of this. It doesn't make sense. It's ridiculous. You said that after I founded the company, I just sold it because it wasn't listed on the stock market. Then why did I start a company?

I know some basic financial knowledge myself, and I think it is generally enough. The duty is nature, and the Tao is natural. People who can't restrain themselves will play something else if they don't play games. Borrowing money is dangerous, and no one knows how crazy the market is (down or up). I remember Buffett saying something like this:If you don't know how to invest, you shouldn't borrow money. If you know how to invest, you don't need to borrow money. You'll be rich sooner or later anyway.

Don't borrow money

It doesn't take courage to invest, which means you're in danger when you need courage.Don't forget the lesson of Lao Ba: don't short, don't borrow money, don't do what you don't understand! There are unlimited risks in shorting, and one mistake can be fatal. Moreover, in the long run, shorting is definitely wrong, because the market must be upward.Value investors make mistakes. There may be only one chance to go short and make a mistake. As long as you go short, there will always be a mistake. Why bother?

In fact, everyone knows more or less what they can do, but often they don't know what they shouldn't do. If everyone does not do what they should not have done, the difference in the result will be beyond the imagination of ordinary people. Take a look at Munger's example of how to make 2 trillion dollars. Munger may really have a good heart, and legend has it that he lost most of his worth in two years because of using margin (probably in the 1970s). So there is the saying that you only need to be rich once. Munger can be regarded as a man who has been rich for more than one and a half times.

The crisis comes about every 5-8 years. I hope the next time you come, you will remember to come here and take a look, wipe off your cold sweat, and then invest all the money you can invest.Never borrow money, because no one knows how crazy the market is.

Buffett is after a company whose products are hard to change, so he can keep it for a long time after he buys it. But he also said that if you can understand change, you will make a lot of money. He said it took him a long time to learn to pay a higher price to buy a company with good growth in the future, and Munger is said to have helped a lot.

We're not in debt. The advantage of debt is that it can grow faster. The advantage of not being in debt is that you can live longer.Whether you borrow money or not will lose endless opportunities in your life, but borrowing money may make it impossible for you to do so again.

Within the understanding of the margin of safety, if you still have money, of course you can buy it again. It is important to note that the increase in size has nothing to do with the increase in the number of people who want to buy (the stock price has gone up). It is only related to value and opportunity cost. I think it's better for Buffett to spend money on BNI than to put it on long-term treasury bonds. BNI has good cash flow and a certain amount of growth and a large area of real estate, and its annual return should exceed 8% in the long run.