📖Duan Yongping
Industry Structure Analysis
Industry structure shapes investment outcomes.
Understand the industry structure before evaluating any company. Industry economics often matter more than company-specific factors in determining returns.
🏠 Everyday Analogy
📖 Core Interpretation
Duan Yongping emphasizes durable business quality over short-term noise. A strong model, real competitive edge, and disciplined capital allocation matter more than quarterly excitement.
💎 Key Insight：Industry economics often matter more than company specifics.
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❓ Why It Matters
Without business-quality filters, investors drift toward stories rather than economics. Durable cash generation is what supports long-term valuation.
🎯 How to Practice
Use a checklist covering moat, management, unit economics, and capital allocation; track long-term cash generation instead of quarter-to-quarter noise.
⚠️ Common Pitfalls
Buying narratives instead of cash-generating economics
Overreacting to short-term operating noise
Ignoring management quality and capital allocation
📚 Case Studies
1
Berkshire Hathaway Purchase (2006)
Duan applied his ‘simple is better’ approach by buying Berkshire Hathaway, focusing on Buffett’s track record, business quality, and capital allocation, without overanalyzing macro forecasts or short-term earnings.
✨ Outcome：Long-term holding appreciated significantly, reinforcing his conviction in concentrated, high-quality, understandable investments.
2
NetEase Leadership Transition (2006)
Duan Yongping invested in NetEase, emphasizing Ding Lei’s integrity and long-term focus despite gaming regulatory uncertainty and past accounting concerns.
✨ Outcome：Management’s prudent capital allocation and product focus drove strong earnings growth and multibagger returns over the following decade.
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