Read Duan Yongping.


Read Duan Yongping, only then can you be considered as entering the field of investment.

Here, investment is not just about stock market investment that is often mentioned, but also includes investment in life.

It can be said that he has given me a great resonance. I highly recognize his investment philosophy and admire how he has summarized many things that I have thought about but couldn't put into words.

In his early years, he updated blog posts on NetEase Blog (Duan Yongping's Blog) and discussed investment issues with fellow bloggers. Later, he moved to Xueqiu (@大道无形我有型). Currently, he is still very active online, not at all like a high-profile investment guru, but more like a passionate netizen quietly typing behind the keyboard.

His successful business operations and investment experiences have attracted a large number of followers. They have discussed a large number of questions with him on blogs and Xueqiu, including topics on corporate investment and management. He has answered almost all of them without reservation. Some people have compiled and arranged these Q&A sessions into two books, "Duan Yongping Investment Q&A Volume One (Business Logic)" and "Duan Yongping Investment Q&A Volume Two (Investment Logic)".

I spent half a month intermittently studying Volume One, and I have taken notes on 200 points. This is unprecedented, and I want to digest every sentence. The feeling he gives me is that there is a sense of enlightenment between the lines, very much in line with the spirit of Taoism. This is the first 5-star book I've read this year.

Next, I will share some of the notes I have taken.


Firstly, he believes that the definition of a great company is:

A company that can maintain its status as a great company for 25 or 30 years.

A great company needs to have a strong corporate culture, have principles, and cannot be purely profit-oriented. It needs to know what to do (or rather, know what not to do), and then pursue efficiency in doing things right.

Currently, Duan Yongping is heavily invested in Apple because he sees these characteristics in Apple:

Let me say one thing I particularly like about Apple: Apple is a very rare company that can focus on "doing the right things" in the long term.

Regarding the pursuit beyond profits, he filters it in this way:

I don't touch anything that talks about reaching a certain market value.

Secondly, when choosing companies to invest in, he mainly focuses on:

My investment criteria are simple: business model, corporate culture, reasonable price. So when a company has a good business model and corporate culture, and the price is also good, I become interested.

The business model determines whether a company can sustain profitability, while corporate culture ensures a continuous attraction of talent and avoids making wrong decisions. Companies that have both of these qualities are generally not cheap, and once they are cheap, it is a rare opportunity.

What makes a good business model? Having a solid moat. A business model without a moat is not a good business model. There are many types of moats for a company, and one common type is differentiation of products - your product can meet certain needs of users that others cannot.

He listed several industries that cannot achieve differentiation, with aviation being the most obvious example. It is difficult for airlines to achieve differentiation, as in the end, they are similar in terms of speed, safety, and service. What consumers care most about is the origin and destination, and they will not choose you just because your service is slightly better than others. They will choose the cheapest option. Therefore, in the end, it becomes a price war, with airlines fighting each other to the death. Industries engaged in price wars are not worth investing in. (It's like the popular saying nowadays, "involution?")

When asked by a netizen whether it is worth investing in industries without differentiation, he gave a clever analogy:

Hehe, if you want to be busy for a day, invite friends to have a meal at your home.

If you want to be busy for a year, renovate your house.

If you want to be busy for a lifetime, invest in several companies like this. (2011-01-05)

The same goes for talents. Your core competitiveness lies in the abilities that others cannot replace.

Netizens often ask him how to screen companies, and his answer is to use a filter. Good companies are rare and difficult to find, but there are plenty of bad companies that can be easily filtered out. For example, using integrity as a filter, filtering out companies that have engaged in dishonest behavior can eliminate a large number of them.

In addition to integrity, there is also focus.

He mentioned that when he saw Nokia launching several models in a year, he knew it was in danger. There are many disadvantages to not being focused:

An entrepreneur should put 80% of their energy into 20% of the things that can bring 80% of the benefits. Many companies have the biggest problem of wanting to do everything. In fact, every company's resources are limited, including manpower, material resources, and financial resources. Using these limited resources for unlimited investments will definitely lead to problems. Some companies do everything, but they don't have any characteristics. You don't know what they are doing.

Having too many varieties means less investment in a single variety, higher total inventory, and higher unit costs.

In this book, I find the most valuable part to be his discussion on what makes a great company, with a focus on business models, corporate culture, and good products.

In addition, the final stop doing list is also very insightful. A true gentleman knows what to do and what not to do.

  1. No sales department, no bargaining
  2. No OEM (Original Equipment Manufacturer)
  3. No borrowing, no interest-bearing loans
  4. No credit
  5. No overdue payments
  6. No delayed salary payments
  7. No dishonest actions
  8. No attacking competitors
  9. No price wars
  10. No discussing cost-effectiveness
  11. No producing undifferentiated products
  12. No participating in trade shows
  13. No overtaking in corners
  14. No acquisitions or mergers
  15. No diversification
  16. No focus on market share, no focus on sales rankings
  17. No blind expansion
  18. No making quick money
  19. No exaggerating product claims
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