Investing

I don't view investing as merely "buying and selling stocks." In my view, investing is a comprehensive discipline: it requires Buffett-style business understanding and long-term thinking, as well as market research, economics, finance, probabilistic thinking from mathematics, and a long-term observation of history, culture, institutions, and human nature. Buffett is a crucial intellectual reference for me, but my actual investment approach goes beyond reciting Buffett — it places the core principles of value investing within a more complete research framework.

• Understand the business first, then the price: I first care about how the business makes money, why customers pay, and whether its competitive advantage can persist — only then do I discuss whether the purchase price is reasonable.
• Margin of Safety: Even the best company may not be a good investment if its price has already discounted the future.
• Independent Judgment: I respect market information, but I don't treat market consensus as truth.
• Long-term Compounding: The core of investing is not high-frequency activity, but letting time become your ally.

Buffett's most important influence on me is not a particular slogan, but that he brought investing back from "price guessing" to "understanding businesses" and "understanding capital allocation." Circle of competence, margin of safety, moats, management incentives, cash flow quality, long-term holding — these principles have shaped my fundamental view of business value.

• Circle of Competence: Better to do less than to pretend to know.
• Moat: Brand, distribution channels, user stickiness, cost advantages, network effects, institutional and cultural factors — all are sources of competitive advantage.
• Capital Allocation: Whether a company is excellent depends not only on the income statement, but also on how management uses retained earnings.
• Investment Temperament: Patience, restraint, and waiting are active skills in investing.

After actually entering the markets, I clearly understand that Buffett's methods must be adapted to real-world contexts. Hong Kong stocks, A-shares, and US stocks differ in valuation systems, market structures, investor behavior, regulatory environments, and liquidity characteristics. Therefore, I combine Buffett-style business analysis with market research, policy judgment, risk management, and scenario analysis.

• Market Research: Industry structure, competitive landscape, user behavior, channel changes, policy impact.
• Financial Analysis: Balance sheet resilience, free cash flow, capital expenditure, return rates, accounting quality.
• Probabilistic Thinking: I lean toward range, odds, and expected value thinking.
• AI-Assisted Research: AI can improve research efficiency, but cannot replace final judgment and accountability.

Why Investing is a Comprehensive Discipline

In my view, investing is inherently connected to history, culture, economics, and finance. History teaches us how cycles repeat and how human nature repeats mistakes through booms and panics; culture determines what consumers trust and how businesses build enduring brands; economics helps us understand resource allocation, industry structure, and competitive order; finance provides tools for valuation, cash flow, cost of capital, and capital structure; and mathematics makes probability, compounding, expected value, volatility, and risk exposure measurable.

Therefore, my investment work is never just about reading financial statements. I also pay attention to corporate history, industry history, institutional environment, management style, user behavior, social psychology, and whether a business that "looks good on the income statement" can truly translate into long-term shareholder returns.

My Analytical Approach

• Step 1: Examine policy, demand structure, and competitive landscape in market research.
• Step 2: Analyze business model, management incentives, and growth logic.
• Step 3: Assess financial integrity, leverage levels, earnings quality, and risk points.
• Step 4: Evaluate valuation, downside protection, and implied expectations.
• Step 5: Review position sizing, discipline, and the cost of mistakes.

Viewing Quantitative Investing Through a Buffett Lens

I don't reject quantitative investing. In a sense, Buffett himself places great importance on numbers. The real question is not whether investing originates from quantification, but whether the numbers serve to deepen understanding of the business's essence, or detach from the business and operate on their own.

• What Buffett would endorse: Quantitative tools can help investors improve discipline and quickly compare valuation, profitability, and risk across a broad range of assets.
• What Buffett would be cautious about: Models struggle to fully capture management character, corporate culture, customer loyalty, and the durability of moats.
• My view: Quantitative investing is best used as a screener, diagnostic tool, and risk management tool.
• My approach: I combine data screening, probabilistic analysis, and structured research with business model judgment, industry structure understanding, and long-term competitive advantage analysis.

So my position is not "quantitative investing vs. value investing," but rather "good quantification should serve good investing."