@KYHBKO: From Buffett to Druckenmiller: Journey in Value Investing !

@KYHBKO is an active Star Contributor in the Tiger Community with over 10k followers!! Consistently providing valuable content about his insights and ideas in investing, he primarily focuses on long term investment with a value investing approach combine with macro-micro economic analysis and technical analysis .

Please briefly introduce yourself, share your personal investment growth experience, and how you made your first bucket of gold in the market?

My name is Benson, currently offering consultancy services with specialization in supply chain and I am doing some M&A work. My investing journey started with Warren Buffett and gradually added the lessons from Peter Lynch, Charlie Munger, Mohnish Pabrai, Morgan Housel, William Green, Howard Mark, Ray Dalio and Stanley Druckenmiller into my (evolving) investing thesis. I started investing from 2019 and my first buckets of gold remain in my portfolio having invested in dividend stocks that provide both price appreciation and dividends. These are mostly HKSE based (China) state owned entities.

How often do you trade? How do you select stocks and control risks?

Recently, I started to trade more, closing short term positions with less than 3 years in holding. Typically, I try to hold my positions for as long as possible unless there are fundamental changes to the business – like loss of competitive advantages or technology disruptions, etc. Initially, I traded like a noob and would jump in and out of stocks that were popular. To control risks, it lies in the research that I do, books that I read and people I listen to. My recent contemplation remains that “I could be wrong”. It is not a lack of confidence or show of humility. It is a state of knowledge gaps that I have come to terms with.

What strategies / indicators do you usually use to trade in stocks market? How much time do you typically dedicate to researching and monitoring trades each week?

Now, I have added macro concerns to my approach. Typically, it starts with me drilling into their financial performance over a few years and I try to exit my positions (trade especially) by using technical indicators or panic. For macro considerations, it is something that is deemed “non” value investing. As my current technical setup is using 1D interval with volume, MACD and Chaikin’s money flow. When stock prices move, there are 3 components of price, time and volume. Thus, 2 technical indicators that involve all 3 should provide a “basic” framework for analysis. I used to crowd my charts with other components like Stochastics, Aroon, Bollinger, Moving Averages (simple & exponential) with VWAP and stuff. Nowadays, I am much less complicated. My weekly preview article demands 3 to 4 hours to compile, a discipline that I have kept for years (and this includes family vacation).

What sector do you find interesting right now ?

Energy and infrastructure. I have written some articles about the demand of energy and how countries are unable to cope with this growth especially with Artificial Intelligence (AI).

Could you introduce your current positions and What is your follow-up trading plan for 2025 and how do you see the stocks market perform in 2025 ?

I have profit making positions in $Tesla Motors(TSLA)$ , $Invesco DB Agriculture Fund(DBA)$ , $Berkshire Hathaway(BRK.B)$. My biggest loss-making position is an inverse ETF that is heavily weighted in my Tiger portfolio. This is a position that I have been building for years (since Covid) and I plan to see this out, adding positions over time. I have another red position in $Visa(V)$ that I may exit soon – pending the new competition in this space.

My outlook for 2025 remains the same – it is possible for us to see both bullish and bearish sentiments at the same time. I will continue to monitor the macro developments (USA tariffs, Ukraine conflict) and natural/man-made disasters. Like any normal market cycle, I am expecting some downturn after the bull run. For 2025, the Magnificent 7 is overly weighted in the $S&P 500(.SPX)$ and this is likely to cause volatility in the market. With the recent LA fires, natural disasters and debt crisis, we should keep a close look at the banking (regional banks), commercial real estate and insurance.

Could you share some of your outstanding trades and tell us the story behind it ?

Most of us learn more from failures than success. I think that it is better for me to share about my biggest losing position in an inverse ETF $ProShares Ultra VIX Short-Term Futures ETF(UVXY)$. I have been buying this every few weeks in anticipation of market correction. It started because of Stanley Druckenmiller. Mr. Druckenmiller, a George Soros protégéran the Duquesne Capital Management hedge fund for nearly 30 years with an average annual return of 30% and no losing years (news dated 22 Dec 2024 – Yahoo Finance).

I saw red lights in Federal spending, the lack of investment into the future, mounting debts, an ageing infrastructure of energy, bridges, highways and roads. His speech was a turning point, and this is becoming one of my biggest (losing) positions for now. Even though recent LEI and LMI data points to some recovery, I fear that America is addicted to consumption and debt. I maybe “living” in my own bubble and bias but, I am hedging on top of my other bullish positions.

We see that you’re very interested and often share the macro-micro economic information, so how do you see the stock market performance in this year 2025 despite the sticky inflation? Will the fed do rate cuts in the next meeting ?

The Fed is caught in a difficult position – they have USD$8 trillions in debt that would be refinanced in 2025 at current interest rates. Bringing down the interest rates will reduce their interest payout that is already bigger than their annual defense budget. But this 3 rate cut can lead to inflation. This means volatility in 2025. The Fed will base their decisions on GDP, inflation and unemployment data. Personally, I hope that they can cut rates in 2025 but I doubt that they can cut rates in the next meeting. Of course, I could be wrong.

Any tips, advice or words to the Tiger friends in the community?

Research before investing and let us consider hedging. Your research can give you the confidence to hold and buy when others panic and sell. Please read other Tiger authors’ content, together we can render a more wholesome view.

If you were to use one sentence as a slogan to get people to subscribe your Tiger Community account, what would it be?

My (cheeky) answer is “I could be wrong” but I look forward to learning and growing together.

Thanks @KYHBKO for the fantastic journey sharing! Hope you have a good trading year in 2025!

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(Event Duration: Now - 2 March 2025)

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