Why Charlie Munger SOLD Alibaba (My Thoughts & Predictions)

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2 жыл бұрын

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Recent 13F Filings show Charlie Munger sells 50% of his Alibaba Stock ($BABA) via The Daily Journal Co in the first quarter of 2022. In this video, I'll be reacting to the news about Munger selling, and I share my thoughts on a few reasons why he might have sold half his position. We also look at Mohnish Pabrai's recent Interview where he shared his reasons for recently selling Alibaba as it may provide a clue as to why Charlie might have sold!
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One Up on Wall St by Peter Lynch - amzn.to/3zI7Ncd
The Intelligent Investor by Benjamin Graham - amzn.to/3JYSBMv
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• Charlie Munger speaks ...
• Mohnish Pabrai on Chin...
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Пікірлер: 8

@investingiq 2 жыл бұрын

After writing this video, I was doing some more snooping and some clever people went through The Daily Journal Co financials and found out that they may have been margin called, or sold to meet debt obligations! So Charlie might not have wanted to sell but was forced to... Will make a post if i find out more!

@chrisaustralianfinance9204 2 жыл бұрын

Only spoke to you about this this afternoon and you've got a video out! One thing I have been trying to get more research on is actually briefly touched on by Charlie. When you invest in China through the US stockmarket, you're buying a derivative. Apparently this has been done once before with Alibaba and Yahoo where there was a bit of a rug pull on Yahoo. Still looking into it as I don't quite understand the ins and outs of it all but there appears to be a suggestion that there is a safer way to invest in Alibaba not on the US stock market where you're not dealing with the derivative company and therefore Charlie may have sold on the US stock market to loss harvest, and rebought using different method which means it won't show up on his 13F Filing form. Maybe I am misunderstanding this but would love you to clarify the above if you understand the concept better.

@investingiq 2 жыл бұрын

Yeah with the Yahoo debacle I think they were private at the time and it was primarily Jack Ma, I'll have to read more into it though. Theres definitely risks but I feel like its simpler than we like to think. On the surface to westerners, it seems the CCP are this evil anti capitalist firm that hate rich people and want to destroy their cash cows and take all the western capital with it. I dont believe this at all. I think some of the moves China made are amazing for society regarding regulations and crackdowns. They wont let their tech CEOs waltz into court like Zuck and just laugh in the Senates faces knowing they cant do anything while they sell information around. China doesnt tolerate that and rightly so. If you act accordingly you'll be fine and I also believe China wants to be a part of the rest of the world and be a leader. By destroying your best and most profitable companies, you set China back decades and completely destroy trust from western investors. If Baba and co get delisted, nobody will ever invest in China again. Some westerners are pretty ignorant and fearful when it comes to cultures that are different to ours, but I like to think in terms of the capital markets, they have a solid way of doing things. Cant say the same in the US where big tech do what they want and have no consequences. Each of Chinas new policies protect and help consumers. Alipay was going to throw debt at people without checks so thats why I think it was pulled. The education sector was praying on parents etc etc. I have no issue buying BABA and I dont think CM does either (I could be wrong). The more I'm reading, the more it could have been a margin call or another person at DJC made the call.. it's so hard to say... it could be anything honestly

@anandkayikkaraanilkumar9288 2 жыл бұрын

Hey mate. What are your thoughts on investing in Meta(FB) ?

@investingiq 2 жыл бұрын

Hey Anand! I like the business, it's a great business model and has had an amazing run. As far as investing, right now Meta goes in the too hard pile because of Metaverse. It's way too hard for me (personally because of my circle of competence) to accurately value or forecast Meta because of the Metaverse play. Alot of uncertainty. Although I'm not opposed to diving in and researching it much more thoroughly because right now I dont really know much about it. I think the Family of Apps is strong but again, I cant really predict how users will behave and how ads will be monetized and regulated.. overall right now I like the company and I'll watch from the sidelines but I dont know enough to comfortably invest :) how about yourself, what do you think?

@anandkayikkaraanilkumar9288 2 жыл бұрын

@@investingiq Thanks for the quick response mate. To further add on, the stock value is now way too low and the business is promising. So can you please explain “way too hard”, or maybe you can do a video 😁😁. If you are interested of course. Thanks 😊

@investingiq 2 жыл бұрын

Yeah sure, I explain Circle of Competence better in this video - kzfaq.info/get/bejne/fclpft2UnZ24oXk.html Essentially, because there's hundreds of promising companies, I need to have a filter system to filter out any companies that aren't in that circle, before looking at financials or valuations. My investing style is about 50% Nick Sleep, 50% Buffett/Munger. So when I buy a company, I pretend I'm buying the whole thing to hold for at least 5-10 years. With Meta, sure it's a great business and has awesome margins etc. But if I'm looking 10+ years into the future for Meta, its very hard (for me) to forecast how they will perform or how the competitive landscape will look for them. There's a lot of uncertainties (for me) and I try to invest based on probabilities. I have no edge or knowledge in that area so trying to pick winners/losers would be like pulling a name out of a hat. It's definitely a cool company, and I'm pretty sure they have a bright future, just not sure enough to bet on it and with my investing philosophy I only have 3-5 holdings that I really really believe in. I'm not saying it's not a great business or a great investment, I'm just saying I don't know enough to make that call and I only invest where I have an edge.

@anandkayikkaraanilkumar9288 2 жыл бұрын

@@investingiq thanks bud ♥️