- Charlie Munger doubled his money on a contrarian bet at age 99, Li Lu says.
- Warren Buffett’s late partner got the idea from Barron’s magazine after 50 years of reading.
- Li recalled a lunch with Elon Musk and Munger that showed their huge differences in risk tolerance.
Charlie Munger was still sniffing out bargains and scoring big gains at age 99, says a close friend of the late investing icon.
Munger, Warren Buffett’s business partner and Berkshire Hathaway’s vice chairman for more than four decades, died in late November 2023, about a month shy of his 100th birthday.
He “read Barron’s magazine every week for 50 years and only made one investment,” Li Lu told Zhenge Island, a Chinese social network, in a rare interview marking the first anniversary of Munger’s death.
“There was a stock that everyone disliked, and it might not be particularly politically correct,” Li said. But that didn’t stop Munger from studying the company and buying its shares, said the Himalaya Capital Management founder whom Munger once described as the “Chinese Warren Buffett.”
The wager showed Munger retained his passion for investing until the end, and “could still go against the market consensus and live to see this stock double,” Li said. “Today, this stock is still in the Munger family portfolio and is still performing very well, and the company is also performing very well.”
Li was the only person apart from Buffett who Munger trusted to invest his family’s money. He introduced Munger to BYD, the Chinese EV maker that’s been one of Berkshire’s best investments over the past decade.
Munger told a similar story at Daily Journal‘s annual meeting in 2017.
“In 50 years I found one investment opportunity in Barron’s, out of which I made about $80 million with almost no risk,” he said. “I took the $80 million and gave it to Li Lu, who turned it into $400 to $500 million. So I have made $400 to 500 million out of reading Barron’s for 50 years and following one idea.”
Munger added further details, indicating that the stock was an auto supply company named Tenneco that Apollo Global Management acquired in late 2022. He said that he made 15 times his money on the stock in about two years, and it only took him 90 minutes of research to pull the trigger after reading about it.
It’s unclear whether Li was referring to that earlier bet, or Munger made another Barron’s-inspired wager in the months before his death. Either way, Munger made several lucrative investments during his career for both Berkshire and himself.
Lunch with Elon Musk
Li recalled a lunch with Munger and Elon Musk, during which the Tesla and SpaceX CEO tried to win Munger’s investment. The discussion showed their similar thinking on subjects such as batteries and science, but also their stark differences in risk appetite, Li said. While Musk said he was willing to do things with only a 5% chance of success, Munger “may need more than 80% chance of success before he will do it,” Li said.
Musk has discussed meeting Munger in the past. Early last year he posted on X that “Munger could’ve invested in Tesla at ~$200M valuation when I had lunch with him in late 2008.” Musk’s automaker went on to become one of the world’s largest companies and is now worth about $1.3 trillion.
“I was at a lunch with Munger in 2009 where he told the whole table all the ways Tesla would fail,” Musk wrote in another post. “Made me quite sad, but I told him I agreed with all those reasons & that we would probably die, but it was worth trying anyway.”
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