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Occasionally, I have followed Warren into a stock that I don't know much about other than the basic investment thesis and the fact that it seemed to have his stamp of approval. This was the case with BYD. I bought some shares (through one of the OTC versions), and made a bit of a paper profit while the Warren hoopla was in the news (remember those articles about how their CEO was the next Thomas Edison, etc.).

Not long after things started to take a turn for the worse. By late 2011, and into 2012 the stock had lost most of its value and everyone was questioning Warren's purchase. There were plenty of bearish articles in the news about the company in Barron's, etc.

One thing struck out in my mind during this time. It was something I always remembered from a poster here about USG. I wish I had the link to the message, but to paraphrase he said, "Most people stare at their positions every day and question whether they should sell. But Warren doesn't think like that. He knows why he made a purchase and he doesn't care what the current price is. He's already moved onto looking at new ideas." This was in regards to USG stock price, which had lost most of its value on asbestos news after Warren purchased a large stake. I thought about selling BYD but this concept stuck in my mind, and even though the company wasn't doing very well, the original purchase idea was still there - a future with mostly electric cars and the world's largest automobile market in China.

Here we are in 2014. The stock hasn't recovered completely from its Warren hoopla price, but I'm basically break-even on my position. Interesting how this simple concept of ignoring the short term market price has made a big difference from a large loss to a break-even position.
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