In the investment market, countless hot topics and concepts are hyped every day. Many investors are keen to chase these short-term trends, hoping to make quick profits. However, I have always adhered to the philosophy of value investing, choosing not to be a 'follower' of the market, but rather a 'discoverer' of corporate value. Over the past 21 years, I have relied on uncovering high-quality companies that are undervalued by the market, growing my initial capital of 70,000 to over 42 million. Value investing is not a rigid doctrine; it is an investment philosophy that focuses on the intrinsic value of companies. It allows me to remain clear-headed amidst the complexities of the market and seize genuine investment opportunities.
The core of value investing is 'buying stocks means buying companies.' Investors should analyze a company's business model, core competitiveness, and financial condition like entrepreneurs to assess its intrinsic value. Then, buy when the market price is below intrinsic value and sell when it is above. In 1999, when I first got into investing, I was deeply influenced by Buffett's value investing philosophy and started learning how to analyze a company's intrinsic value. Initially, I only looked at indicators like price-to-earnings ratio and price-to-book ratio, but gradually delved deeper into financial statements and industry competition.
In 2002, I discovered a chemical company whose products had strong competitiveness in the market, with its market share ranking first in the industry for several consecutive years, and the company had ample cash flow and low debt. However, due to the overall downturn in the chemical industry at that time, this company's stock price was severely undervalued, with a price-to-earnings ratio of only 8 times. Through detailed analysis, I calculated that the company's intrinsic value was far higher than the market price at that time, so I decisively bought in. During the holding period, I closely monitored the company's operational status and found that its performance consistently grew steadily. By 2007, with the recovery of the chemical industry, this company's stock price increased by 12 times, and I also reaped substantial rewards.
Many people believe that value investing requires long-term holding, so they ignore changes in a company's fundamentals and blindly hold for the long term. However, in my opinion, value investing is not about blindly holding long-term; it is about dynamically tracking a company's intrinsic value. If a company's fundamentals undergo significant deterioration and its intrinsic value declines, even if I have held it for a long time, I should decisively sell. In 2016, I held a textile company whose performance declined continuously due to rising raw material prices and international trade frictions, and its core competitiveness was also decreasing. I judged that this company's intrinsic value had decreased, so I sold it in time to avoid further losses.
Uncovering a company's intrinsic value requires solid analytical skills and sufficient patience. I spend a lot of time daily reading financial statements, industry reports, and conducting on-site research on a company's operational status. Sometimes, to analyze a company, I study for several months until I am well-versed in every aspect of it. This in-depth analysis allows me to accurately assess a company's intrinsic value and avoid being misled by short-term market fluctuations.
Today, I still adhere to the value investing philosophy, focusing on uncovering high-quality companies that are undervalued by the market. In my view, the essence of investing is sharing the returns brought by a company's growth, and value investing is the most reliable way to achieve this goal. Although the market changes every day and trends shift constantly, the core logic of value investing remains unchanged. As long as we stick to this philosophy and diligently dig into a company's intrinsic value, turning the principal into hundreds of times is not a dream but an achievable goal.@男神讲趋势 #加密市场反弹 $BTC
