Financial Associated Press (Shanghai, editor Shi Zhengcheng) news, at the beginning of the new year, the global stock market in the context of the Federal Reserve to accelerate the tightening of monetary policy significant correction, the NASDAQ index as the representative of the technology growth stocks generally appeared deep adjustment. The last time a similar situation occurred roughly back to february-March 2020, when the NASDAQ fell 32% after failing to hit the 10,000-point mark.
In this round of stock market crash, Leo KoGuan, a 60-year-old Chinese entrepreneur, although he began to speculate in stocks for only a year, became a well-known financial figure with the company of "idol" Musk. His personal social media also attracted nearly 20,000 followers, mostly from Musk's die-hard loyalist group.
What is more worth mentioning is that the wealth brought to him by the heavy position of Tesla stock has soared.
According to the Bloomberg Billionaires Index, as of the close of trading on February 2, Liao Kaiyuan's worth reached $9.33 billion, ranking about 250 in the world, of which the largest proportion is Tesla stock.
It is worth mentioning that Liao Kaiyuan's "Tesla's third largest individual shareholder" (after Musk and Oracle CEO Larry Ellison) is not self-imposed, and Martin Viecha, Tesla's head of investor relations, confirmed this statement on social media last September.
(Source: Social Media)
Tesla "cow scatter" history
Although it looks like Sister Wood, Liao Kaiyuan is also an investor who relies on Tesla to make a lot of money, but in fact, Liao Kaiyuan did not start speculating in stocks until 2019, and still regards himself as a retail investor today.
Born in Indonesia in 1955, the "Tesla Cow Scatter" went to the United States to study, and received a master's degree in international relations from Columbia University and a doctorate in law from New York Law School.
As for his fortune, Liao Kaiyuan said in a guest financial streaming program at the end of 2021 that he plunged into the New York real estate market in the year he graduated with his 30th doctorate, accumulating capital by buying houses and renovating them to increase the rental value of real estate. Five years later, newly married, Mr. and Mrs. Liao Kaiyuan bought a software distribution company that was in debt and renamed it Software House International.
When the couple divorced in 2001, Liao continued to serve as a non-executive director and owned a 40 percent stake in the company, when the annual revenue of the "software house" had reached a billion US dollars. By 2021, the "International Software House" has become an integrated IT solution giant with revenue of $11.5 billion, which can also explain the source of funds for this "cattle scatter".
It is worth mentioning that as early as before buying Tesla stock, many Chinese may have heard of Liao Kaiyuan's name, but there is a serious differentiation in public opinion evaluation.
Between 2005 and 2011, Liao Kaiyuan donated a total of 600 million yuan to Peking University, Tsinghua University, Fudan university and Shanghai Jiaotong University to build teaching facilities and title them, and the law school of Shanghai Jiaotong University was renamed Kaiyuan Law School. Donating money to fund education is certainly a commendable good deed, and the reason for the subsequent controversy is that as part of the sponsorship, Liao Kaiyuan also taught "Kaiyuan Quantum Information Mechanics" at the above-mentioned top universities. Critics argue that China's top universities have sacrificed academic thresholds for sponsorship, and there are also voices saying that it is understandable to meet the "small requirements of donors that do not violate the big principles" to solve the actual financial difficulties of universities.
In addition to the donations, Liao Kaiyuan once invested in two super five-star hotels in Xintiandi, a top location in Shanghai, but the project was forced to shelve due to the financial crisis in 2008, after which Shui On Land took over all of Liao Kaiyuan's shares.
Stubbornly bumped into bull stocks
Although Liao Kaiyuan's "quantum information mechanics" has not been recognized by mainstream academics, it has opened another door for his investment path.
In 2019, Liao Kaiyuan began to invest in US stocks, and like many retail investors, he used a large amount of funds to buy shares of well-known companies such as Baidu, Weilai Automobile, and NVIDIA. In the context of the ever-expanding US stock bubble, these investments initially floated a lot of profits, but under the influence of Trump's "troublemaking", in May of that year alone, many popular stocks recorded double-digit declines, of which Baidu fell by 33% and Nvidia fell by 25%.
After experiencing a sharp fall, Liao Kaiyuan turned all his positions to Tesla, and the reason that prompted him to make this decision was that the worship of Musk, especially the success of meeting this idol, should be an extremely important reason.
Liao Kaiyuan wrote on his social media: "On October 10, 2019, I met with Musk in his SpaceX office, we discussed Einstein's theory of relativity, and [we talked so much that] forgot to ask him about SpaceX. ”
At the beginning of 2020, Liao Kaiyuan held a total of 2.3 million Tesla shares, which is equivalent to about 12 million shares according to the subsequent stock split plan. But in the wake of the pandemic's devastation, these $1.5 billion positions, in his own words, were "almost all gone."
At that time, buying back 12 million shares became an important goal for Liao Kaiyuan to accumulate Tesla stock "from scratch".
Like Liao Kaiyuan's obsession with promoting "quantum mechanics", the follow-up operation also reflects his stubbornness: "bet on all the property" to buy short-term in-the-money call options, and when the stock price rises, take out some profits to replace Tesla stocks, and at the same time take out the remaining profits to continue to buy Tesla options. In other words, it is to constantly use financial derivatives to repeatedly bet that Tesla will rise.
As a result, I believe everyone is also very clear, Tesla's stock has soared for two consecutive years, from the end of the epidemic in 2020 to the high point at the end of last year, its stock price has increased by a total of 17 times.
(Tesla daily chart, source: TradingView)
All the eggs in one basket?
Of course, Liao Kaiyuan did not approve of the accusations of investment advisers for putting all his eggs in a basket: he did not have an equity stake in the "International Software House" on hand.
According to Liao Kaiyuan's statement on social media, he bought another 310,000 shares of Tesla stock at the end of October last year, bringing his total position to 7.01 million shares. According to media sources quoted by the media, he also has Tesla options with varying exercise prices.
Liao Kaiyuan's belief in Tesla is also reflected in the belief in firm positions, he has made it clear that the purpose of buying Tesla stock is to accumulate $100 billion or more of wealth, of course, this money is also used to spread and promote his ideas.
When asked about his views on the future market after last week's market crash, Liao Kaiyuan stressed that although he has short-term concerns about the market, he continues to be bullish in the long run and will continue to hold Tesla stock until 2030.
After the end of January, the market atmosphere of the US stock market has improved significantly, the US stock market has come out of the "four consecutive yangs", driven by the strong financial reports and sharp rises of google, AMD and other technology companies, the market sentiment has generally picked up.
Of course, for Tesla stocks, Liao Kaiyuan's crazy love for Musk also seems to constitute a potential uncertainty factor: if Musk one day stepped down as Tesla CEO (he really mentioned this matter) and concentrated on Mars immigration, would Liao Kaiyuan sell his huge position?
Written at the end: The prerequisite for becoming a "gambler-style stock god"
It must be admitted that the most fundamental reason why Liao Kaiyuan's seemingly absurd and in fact methodical investment is worth writing about is that the object of his "stubborn" hype is Tesla, which has both topics and benefits.
But in such a highly accidental story, another principle of stock market investment is also revealed: never spend all the chips at hand.
The reason why Liao Kaiyuan was able to "make a comeback" after losing Tesla's equity was that in addition to the courage of "betting on the real estate certificate", it was also inseparable from a highly stable cash flow. Although "Software House" is not a listed company, in an interview with Forbes in 2015, Liao's ex-wife, Thai Lee, CEO of "Software House", revealed that the company's net profit margin was about 3%.
Although the outside world does not know the specific dividend situation, holding this money-making machine that can "produce" tens of millions or even hundreds of millions of dollars in profits every year is undoubtedly the cornerstone of Liao Kaiyuan's subsequent series of capital operations, and it is also the source of his courage to dare to "copy the bottom for love".