I had not paid much attention to the concept of value investing, as I thought I know everything there is to it: Do not chase fads. Invest in companies with solid money-making capabilities. Invest in the long-term.
It turns out that it was wrong. There is so much more to value investing, if one wants to be a value investor.
I learned that from listening to the story of Li Lu on the Founders podcast. I had known a bit about him before , but boy, what a legendary life he has had. Having grown up in a depressive and suppressive environment in China, and having survived many physical and psychological traumas in his childhood, he got into college by his sheer will power and immense intellectual capacity. For his political dissent, he was exiled to US. Here in the US, he not only managed to get two advanced degrees in business and law, but also through hard work and some good fortune built up a successful hedge fund.
Lu’s intellectual curiosity and his drive are the two hallmarks of his success. In fact, I now believe these are the two common traits of all business visionaries (Jobs, Bezos, Musk, Gates).
Another important lesson I learned from Lu: There are not many great opportunities in life, maybe 4 or 5 of them; But when they show up at your door, you’d better grab them and bet your life on them. I think this not only applied to value investing, but also to life in general.
Here is the video of a guest lecture Lu delivered to a class of Master’s students: