This Chinese entrepreneur won a lunch with Warren Buffett, and his looking to beat him with cryptocurrency.
Chinese entrepreneur Sam Ling and his partner spent $2.35 million bidding on a private lunch with Warren Buffett in 2015.
Buffett, who Ling calls his “idol,” has expressed skepticism about cryptocurrencies.
The businessman, nonetheless, says he is willing to bet that his cryptocurrency index will outperform Buffett’s portfolio over the next 10 years.
Warren Buffett and Sam Ling at a lunch that the Chinese entrepreneur won at a charity auction.
In 2015, Chinese entrepreneur Sam Ling and his partner spent $2.35 million bidding on a private lunch with Warren Buffett, hoping to get some investment advice from the legendary investor.
Three year later, the 31-year-old businessman still uses his photo with Buffett as his phone’s wallpaper.
“Buffett is my idol,” Ling, founder and CEO of Supwin Financial Services Group based in Guangzhou, China, told CNBC in Chinese. “I have been looking up to him and studying his investment strategies for so many years. I’m a loyal fan of his.”
But that loyalty isn’t stopping him from betting big on something Buffett — the world’s third-richest person — has publicly projected “will come to a bad ending”: cryptocurrency.
If there’s anything Ling learned from Buffett, he said, it is an appreciation for index funds. Ling, however, wants to apply that outlook to the digital currency realm.
“Cryptocurrencies like bitcoin are too volatile, and that’s why we are launching cryptocurrency indexes,” Ling told CNBC. “Over the past six months, our index has a lower decline than bitcoin during corrections, but has outperformed bitcoin by 50 to 80 percent during upsurges.”
Ling is launching the “BB Index” family of 26 cryptocurrency indexes. They’re grouped by market capitalization, category and strategy, ranging from a “Blockchain Top 7 Index” that covers the largest cryptocurrencies to a “Blockchain Top 50 ex top 20 Token Index” that covers mid-cap assets. All BB Indexes are updated every three minutes on its official website, Ling said.
“Think about the risk management, (and) think about the correlation. Actually we have different indexes to help people find the desired expected return they pursue,” said Jerry Cao, chief scientist of BB Index and a former assistant professor of finance at Singapore Management University.
“Rather than thinking, ‘Hey this cryptocurrency will rise 10 percent tomorrow,’ that’s a very short-term view,” Cao added. “What we are really thinking is to extract from the short-term movement and think about one year or five years — what will be the application of those cryptocurrencies and their underlying blockchain?”
“Buffett touched on lots of issues during that lunch, but in the end, he said, ‘Focus on what you are doing and you are already successful,'” recalled Ling. “This quote really left me with a deep impression and I followed his advice.”
However, Buffett has made it clear he believes the craze over cryptocurrencies won’t end well.
“In terms of cryptocurrencies, generally, I can say with almost certainty that they will come to a bad ending,” the chairman and CEO of Berkshire Hathaway said during an interview with CNBC’s Betty Quick in January 2018.
But Ling disagreed with his idol this time, saying he is confident that BB Index returns will beat any traditional portfolio manager, including Buffett.