Hi Paul. A nice summary piece here and I can actually feel how reality bites in since we chatted in Hangzhou a few months back.
- I think you are indeed very talented and hard working investor (whether or not you "undoubtedly will be the best in China", only time will tell... haha )
- what you still need to improve or overcome, are 1) stretching too thin, 2) lack of understading of how maintream funds think about things, and 3) ability to scale up
- 1) it is encouraging to see you have realized that in your own review. Teaming up with like-minded and trust-worthy co-investors, you are going to be more effective by leveraging and focusing. Difficulty is to maintain the team and manage the expectation. If interested, I am more than happy to offer my 2 cents especially HK names like macau/ consumer/ insurance, etc.
- 2) I can assure you that buying WUBA /VIPS is not all from "insider trading". There are very ligitimate reasons for long term focused mainstream funds / or even quick IRR seeking hedge funds to bid up the price. In HK you have tons of them. They may not be right, and you certainly don't have to agree with them. But not knowing your opponents, their perspective, logic, habit, and capability can undermine you games. Especially when you are shorting against them.
- 3) as we talked bout it before, your method of sweeping all financial reports and react upon public info to uncover gems can earn you edge and therefore money. But it tends to work better with smaller / more obscure/less liquid names like 296/ IT, etc. Things can be different when it gets to Biostime, Greatwall, etc. And to operate bigger funds you need to find a better way out. Buyging APPLE makes good money but it will be hard to argue that you have an edge over others.
It is never meant to be easy. But you already are much better than most of the so-called institutional investors I dealt with in HK. Best part is that you still have tons of time in front of you to continue to learn and improve. Surely you will be doing better each year: Not necessarily with higher annual return numbers, but more mature and wise over time.
Happy investing