Investment Perspective-Focus global invesment, reseach creates value!

1. What is investing?

Bluerock Fund: Investing means owning part or all of a company—the core concept is "ownership". Identify the best businesses, allocate capital to them, and compare their profit potential against risk-free rates to find opportunities that are both superior and secure enough.
A reminder: Growth rates alone mean little. If a company earns $1 per share one year and $2 the next (100% growth), who knows what next year brings? Focus on durability, not short-term spikes.

2. What matters most in investing?

Bluerock Fund: Key principles:

A. Ownership mindset: Buying a stock equals buying a business—whether it’s public or private makes no difference in valuation. Listing merely aids liquidity.
B. Intrinsic value: A company’s worth is the discounted present value of its future cash flows. Invest when price < intrinsic value. The "margin of safety" (40%, 50%, etc.) depends on your opportunity cost.
C. Think, don’t calculate: Discounted cash flow is a framework, not a formula. Skip the calculator; focus on qualitative judgment.
D. Circle of competence: Knowing your limits is necessary to assess intrinsic value, but not sufficient on its own.
E. Moats matter: A competitive moat is critical for judging value, but not the only factor.
F. Culture as a moat pillar: A strong corporate culture is essential to building and maintaining a durable moat. Poor culture undermines long-term resilience.

3. What defines a good company?

Bluerock Fund: You’ll recognize a good company when you see it—nailing the business model is the key to profits.
Capital-intensive industries rarely spawn great companies. The ideal business generates massive cash flow with minimal reinvestment. The strongest moat? Monopoly or unassailable competitive advantage, rooted in a model that ensures predictable future cash flows.

4. What makes a "sleep-well-at-night" investment?

Bluerock Fund: Three factors: right business, right people, right price.

Business: A proven, durable model.
People: A culture that aligns with long-term value.
Price: Reasonable, not necessarily rock-bottom. With the first two in place, time reduces price sensitivity.

5. Prioritizing business, people, and price?

Bluerock Fund: Price is secondary; business model and culture come first. I won’t even analyze a company if I dislike either. The business model is paramount—without it, you’ll get lost in short-term noise.
Buffett taught me: "First, consider the business model." Simple, but understanding what makes a model "good" takes work—like explaining golf to someone who’s never played.

6. What’s a good business model?

Bluerock Fund: It’s how a company makes money—and whether it’ll thrive in 10 years. A strong model has a moat. Moats aren’t static; culture is vital to building and sustaining them.

7. What is a "moat"?

Bluerock Fund: A sustainable competitive advantage—a product or service that meets unique customer needs, impossible for rivals to replicate long-term.
Avoid industries with undifferentiated products (e.g., airlines, solar panels). While bad businesses might deliver short-term gains, betting on moats and culture ensures better returns over decades—and a stress-free ride.

8. Why prioritize corporate culture?

Bluerock Fund: Products can be copied; culture cannot. Think of culture as the foundation of a barrel—without it, the barrel leaks. A strong culture fixes flaws; a weak one dooms even good systems.
In cultures where employees fear leaders, responsibility vanishes, and efficiency plummets. Building culture is hard; destroying it is easy. Companies with deep-rooted values are far more resilient.

9. What does "truly understanding a company" mean?

Bluerock Fund: If you have doubts, you don’t understand it.
A company I understand: I’d hold it no matter how high it rises, and buy more if it drops. A company I don’t: I’d sell at the first dip or small gain. If you fear price swings, stay away—fear and investing don’t mix.

10. Who are value investors?

Bluerock Fund: Value investors buy stocks as if they could acquire the entire company. They chase intrinsic value, not popularity. All great companies eventually shine—patience is key.
Ironically, non-investors who avoid the market often outperform 85% of participants by default. Admitting you’re unsuited to investing isn’t shameful—it’s wise. Buffett’s best lesson for most: Stay away unless you can study deeply.

11. Why is long-term holding so hard?

Bluerock Fund: Mastering two lessons—valuing businesses and ignoring market noise—plus a dose of luck, makes investing manageable. Human nature complicates the second lesson, but here’s how to stay disciplined:

A. Low expectations: Avoid chasing unrealistic returns.
B. Market humility: Understand that markets are irrational; don’t fight them.
C. Business focus: Track the company, not the stock price.
D. Limit market exposure: Stay away from daily K-line charts.
E. Long time horizon: Evaluate returns over 5+ years, not quarters.
F. Intellectual modesty: Assume you’re not smarter than the market.
G. Private-company mindset: Invest as if the stock were unlisted—would you still buy?
Imagine owning a private company with one shareholder (you). This clarity cuts through market noise and anchors you in ownership thinking.

Investment Perspective