🗣️ Investor Talk #27: Chin Hui Leong

Co-founder - The Smart Investor

Welcome to Investor Talk — where we interview successful investors to uncover their journeys, strategies, and the lessons they've learned. Get inspired by real stories and gain valuable insights to sharpen your own investment approach.

Every interview follows the same set of sharp, insightful questions — such as “What is your investment strategy?”, “What are your highest conviction stocks?”, and “What’s the biggest investment mistake you’ve made?”

In this edition, we have the pleasure of interviewing:

Name: Chin Hui Leong @chin_investor
Age: 48
Residence/Country: Singapore
Invests since: 2005

𝗜𝗻𝘁𝗿𝗼𝗱𝘂𝗰𝘁𝗶𝗼𝗻
I grew up in Penang, Malaysia and studied in Singapore in my late teens. My first job started with project management and turned into procurement. It was an unexpected twist which turned out to be a decade of work, where I travelled around Asia, Europe, and the US visiting businesses of all shapes and sizes. That’s where the kindle of interest in studying businesses was lit. I was fascinated by how people, culture, business strategy, and industries intersect and the cornucopia of outcomes created.

In a nutshell, investing was a hobby which gradually into what I wanted to do every day. The Great Financial Crisis, which happened two years after I started investing, was a gut-wrenching experience when it was happening but turned out to be the most eye-opening moment. In my mind, the event was the greatest ever stress test for businesses, and from it, you get the clearest view of what businesses can survive and thrive when things get better.

In 2020, just before the pandemic, I co-founded The Smart investor together with David Kuo and Joanna Sng.

𝗪𝗵𝗮𝘁 𝗶𝘀 𝘆𝗼𝘂𝗿 𝗶𝗻𝘃𝗲𝘀𝘁𝗺𝗲𝗻𝘁 𝘀𝘁𝗿𝗮𝘁𝗲𝗴𝘆?
My investing style is inspired by Motley Fool co-founder, David Gardner @DavidGFool, and forged by Tom Engle, a popular member of the old Motley Fool boards.

When it comes to picking stocks, I like to start with a blank sheet. Like Lego, I like to build up an initial thesis for the business.

Source for my Lego blocks:
1. Investing concepts: the innovator’s dilemma, the long tail, the outsiders.
2. Previous job experience: industries, business travel, supply chain management.
3. Emerging trends: software eats the world.
4. Smart backing: opinions of investors with great track records.
5. Desirable characteristics: growing revenue, history of free cash flow and growth without the use of debt, strong balance sheet, etc.

In essence, I want to learn why a successful business has done well over time, and whether it can continue to do so.

From there, I will follow the business developments and management team over time to validate or add to my initial thesis. The business drive the stock’s valuation, rather than have the valuation make up for a less stellar business.

𝗛𝗼𝘄 𝗺𝗮𝗻𝘆 𝘀𝘁𝗼𝗰𝗸𝘀 𝗮𝗿𝗲 𝗰𝘂𝗿𝗿𝗲𝗻𝘁𝗹𝘆 𝗵𝗲𝗹𝗱 𝗶𝗻 𝘆𝗼𝘂𝗿 𝗽𝗼𝗿𝘁𝗳𝗼𝗹𝗶𝗼? More than 60 stocks. But the top 10 takes up roughly half my portfolio.

𝗪𝗵𝗶𝗰𝗵 𝘀𝗲𝗰𝘁𝗼𝗿𝘀 𝗱𝗼 𝘆𝗼𝘂 𝗺𝗮𝗶𝗻𝗹𝘆 𝗳𝗼𝗰𝘂𝘀 𝗼𝗻?
I don’t invest based on sectors. But software companies have become into a big part of my portfolio.

𝗪𝗵𝗶𝗰𝗵 𝘀𝘁𝗼𝗰𝗸 𝗵𝗮𝘀 𝘁𝗵𝗲 𝗵𝗶𝗴𝗵𝗲𝘀𝘁 𝗿𝗲𝘁𝘂𝗿𝗻? $NFLX Netflix is up around 186x since my purchase back in January 2007.

𝗪𝗵𝗮𝘁 𝗶𝘀 𝘁𝗵𝗲 𝗯𝗶𝗴𝗴𝗲𝘀𝘁 𝗶𝗻𝘃𝗲𝘀𝘁𝗺𝗲𝗻𝘁 𝗺𝗶𝘀𝘁𝗮𝗸𝗲 𝘆𝗼𝘂 𝗵𝗮𝘃𝗲 𝗺𝗮𝗱𝗲?
My worst mistake was also Netflix $NFLX. I sold half of my position sometime in 2011.

My brain convinced me to sell half of the stock after it went up by 100% or so. I did a detailed valuation on excel to convince myself that I had done my "homework" and my action will be correct. In reality, I was just scared of losing my gains. Lesson learnt.

𝗠𝘆 𝗳𝗮𝘃𝗼𝗿𝗶𝘁𝗲𝘀
Favorite books: Shoe Dog, Robert Kuok: A Memoir, Subscribed, Your Money and Your Brain, In the Plex.

Favorite podcast: How I Built This by Guy Raz @HowIBuiltThis

Favorite quote: "It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so." - Mark Twain

Favorite FinX account: So many smart people out there: @SteadyCompound, @BenCarlson, @Eugene_VCap, @borrowed_ideas, @TOSH_Investing Also, shout out to @TechEmails Internal tech emails offer a window to the minds of tech leaders.

𝗪𝗵𝗲𝗿𝗲 𝗰𝗮𝗻 𝘄𝗲 𝗳𝗶𝗻𝗱 𝗺𝗼𝗿𝗲 𝗶𝗻𝗳𝗼 𝗮𝗯𝗼𝘂𝘁 𝘆𝗼𝘂?
You can find my latest articles here https://thesmartinvestor.com.sg/category/us-stocks/

Disclaimer:
The information and opinions provided in this article are for informational and educational purposes only and should not be considered as investment advice or a recommendation to buy, sell, or hold any financial product, security, or asset. The Future Investors does not provide personalized investment advice and is not a licensed financial advisor. Always do your own research before making any investment decisions and consult with a qualified financial professional before making any investment decisions. Please consult the general disclaimer for more details.