Reflections on 13 Years of Investing: A Wake-Up Call in 2024 -2025-01-28

After 13 years of investing, countless theories, and extensive study, the year 2024 has been another wake-up call for me.

Looking back, my approach to long-term investing in the past was, in reality, still short-term and speculative. I would sell stocks when I believed their prices were too high, trying to time the market. This behavior, though seemingly logical, was speculative in nature. Warren Buffett’s teachings have made it clear that true financial growth comes from holding onto good companies for the long term.

It’s important to remember that when we buy shares, we’re not just buying numbers on a screen—we’re buying a piece of a company. There are two ways to make money from the market:

Speculation: Selling to someone willing to pay more than you did.

Ownership: Earning profits as the company grows and performs well.

Warren Buffett has shown us that while the first method can help accumulate an initial pot of gold, it’s not sustainable. It requires constant effort, exceptional foresight, and luck. The chances of failure are high, and the process is mentally exhausting.

The second method, owning a great company and letting it grow over time, is far more rewarding. A solid business model allows you to benefit from the company’s success without constant worry, even during crises. While the growth may seem slow initially, it’s steady, sustainable, and can bring substantial profits over the long term.

Embracing Quality Companies

Over the years, I’ve evolved to embrace quality companies like Visa, Mastercard, Google, Apple, and Berkshire Hathaway. These companies share a common trait: they’re financially sound and prioritize shareholder value through share buybacks and, in some cases, dividends.

When I first bought Google in 2020, I had little confidence because its valuation seemed high. But following Warren Buffett and Charlie Munger’s teaching, I realized that good companies are often "a bit hard to swallow" due to their price. I later added more Google shares and also invested in Mastercard during the same year. By 2021, I began buying Visa and Apple, and in 2023, I added PayPal, Berkshire Hathaway, and finally Confluent in 2024.

The Case for Confluent

My investment in Confluent is tied to my understanding of software and Warren Buffett’s principle of long-term growth. Confluent, built on Kafka, is moving rapidly and has become highly sticky with its customers. If competitors fail to disrupt them, I believe Confluent has the potential to become a dominant player in the long run.

Final Thoughts

Investing in high-quality companies may feel expensive initially, but the rewards of long-term growth far outweigh the short-term concerns. As I’ve learned through trial and error, patience and conviction in owning great businesses are the keys to lasting financial success.