The Daily Journal (DJCO) disclosed its latest investment portfolios on Jan, 4th, 2022, where Mr. Charlie Munger works as chairman. The Daily Journal doubled its Alibaba holding in the fourth quarter of 2021, and currently holds 602,060 Alibaba US stocks. (1 Alibaba US stock = 8 Alibaba Hong Kong stocks)
Table of Contents
Mr. Charlie Munger Buying History of Alibaba US Stocks
The investment decision of Alibaba was made by Mr. Charlie Munger as the chairman of the company on behalf of the Daily Journal. It is an account solely responsible for the shareholders of the Daily Journal.
Therefore, the absolute amount and proportion of this investment can only be compared with the total holding value of the Daily Journal, not the total value of Charlie Munger’s personal assets or Berkshire‘s investment portfolios.
In terms of the total investment of approximately $260 million in Daily Journal alone, the total investment of approximately $100 million in Alibaba can be said to be “heavy holdings” with certainty.
2021 Q1
In the first quarter of 2021, Alibaba’s highest stock price was $274.29, the lowest stock price was $220.09, and the closing price was $226.73. Mr. Charlie Munger bought a total of 165,320 shares.
Roughly estimated his average buying price based on the lowest 1/3 of the quarter, that is: (274.29-220.09)/3+220.09≈$238, and investment of 16.532×238≈$39.35 million.
2021 Q2
In the second quarter of 2021, Alibaba was roughly flat with little fluctuation, and Munger had no buying or selling.
2021 Q3
In the third quarter of 2021, Alibaba’s stock price continued to fall sharply, with the highest price of the quarter being $228.85, the lowest price of $144.44, and the closing price of $148.05.
Munger bought 136,740 shares, estimated the purchase price at $172 in the same way, and invested 13.674×172≈23.52 million US dollars. The total number of shares held rose to 302060 shares.
2021 Q4
In the fourth quarter of 2021, Alibaba’s stock price continued to fall sharply, with the highest price of the quarter being $182.09, the lowest price of $108.7, and the closing price of $118.79.
Munger doubled its holding and bought 300,000 shares. According to the same method, his purchasing price was estimated to be 133 US dollars, and the investment capital is 30×133≈39.9 million US dollars.
Mr. Charlie Munger Average Buying Price and Floating Loss of Alibaba US Stocks
The total invested capital is 3935+2352+3990≈103 million U.S. dollars, currently holding 602,060 shares, and the average purchase cost is estimated to be about 171 U.S. dollars. Based on the closing price of $118.79 on 12/31/2021, the market value of the position held was $71.52 million, with a floating loss of approximately 30%.
Among them, the floating loss purchased in the first quarter was about 50%+, the floating loss purchased in the third quarter was about 30%+, and the floating loss purchased in the fourth quarter was about 10%+.
The Daily Journal Investment Portfolio
The Daily Journal’s total market value is approximately $500 million. In addition to operating publishing and legal services, the company also has investment businesses, which have a combined market value of approximately US$260 million at the end of 2021 as the following table.
| Company | Shares Held | Closing Price 12/31/2021 | Market Value |
Portfolio %
|
| Bank of America Corp. (BAC) | 2,300,000 | 44.49 | $1,023,270,000 | 39.56% |
| Wells Fargo & Co. (WFC) | 1,591,800 | 47.98 | $763,740,000 | 29.53% |
| Alibaba Group Holding Ltd (BABA) | 602,060 | 118.79 | $715,190,000 | 27.65% |
| U.S. Bancorp (First National Bank of Cincinnati) (USB) | 140,000 | 56.17 | $78,640,000 | 3.04% |
| POSCO, Inc. (PKX) | 9,745 | 61.25 | $5,680,000 | 0.22% |
| In Total | $2,586,520,000 | 100% |
Note: Data comes from WhaleWisdom
The Investment in Alibaba rose to 27.65% of the Daily Journal’s total investment portfolio, which became the third-largest position after Bank of America 39.56% and Wells Fargo 29.53%.
The high concentration of the company’s shareholding portfolio is Mr. Charlie Munger’s customary practice. The $260 million portfolios have a total of five stocks, of which the top three accounted for more than 96%.
Final Thought
Mr. Charlie Munger’s inventment on Alibaba shows that this nearly 100-year-old man is still trying to learn and expand his ability. I believe that tracking and watching the world’s wisest man’s investment will bring us a lot of inspiration no matter whether the result is good or not.
The story is not over, and we’ll continue to update Mr. Charlie Munger’s investment on Alibaba if that happens.
Image source
