How Li Lu, the Chinese Warren Buffett, spots market gold

Li Lu, the Founder and Chairman of Himalaya Capital, is not called 'The Chinese Warren Buffett' for nothing. A devout value investor, he has built his fortune using the same principles that made Buffett a legend: deep research, disciplined investing, and the courage to go against the crowd. Lu has managed Himalaya's principal fund since 1997, delivering extraordinary annual returns of 30 per cent! His most legendary bet was an early investment in BYD, which has skyrocketed over 5,600 per cent since 2002. At a lecture at Columbia Business School, the Chinese-born American investing genius broke down his investing playbook—how to spot undervalued businesses, when to go all in, and why the biggest mistake is missing out on great opportunities. We lay out some of the key takeaways: Value investing: Swimming against the tide "Value investors are a rare breed," Lu says to the audience. "Fewer than 5 per cent of investors follow this approach." The investing world is driven by emotions like fear and greed, and the endless chase for short-term gains. But value investing demands a different mindset, one that thrives on patience and conviction rather than reacting to daily price swings. To succeed, Lu explains, an investor must embrace being in the minority. It requires the discipline to trust research over hype, and the willingness to be wrong in the short term wh

This article was originally published on January 30, 2025.