Previous post on February 3, 2022.
A Good Day
Category: Thoughts On Investing
Instant Delivery: Challenges That Cannot Be Overcome
[This is not investment advice. Do your own due diligence.]
Instant Delivery is in overdrive. Billions of VC money has been poured into this space since 2020. Unicorns are made, even with less than one year of business history. Some companies are aspiring for a valuation of $40B! As a reference, Uber is trading at ~$70B and DoorDash is at ~$35B.
Despite these dazzling valuation figures, I am increasingly convinced that Instant Delivery, and broadly speaking Grocery Delivery, most likely will NOT work in the U.S. Today’s valuation levels might later be seen as high-water marks, causing permanent capital losses to late coming investors.
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Why I am still Bullish on DoorDash
[I own DoorDash stocks. This is not investment advice. Do your own due diligence.]
This is a follow-up piece to my previous post on DoorDash (Sep 2021, link here).
I liquidated my previous DoorDash position in early- and mid- November 2021. Since then, I have been buying DoorDash again.
Summary
DoorDash is the No.1 Food Delivery company in the U.S. Controlling over 50% of the U.S. Food Delivery market, DoorDash has the largest delivery network, the highest work density, and the lowest delivery cost. It is a powerful network that can solve a variety of use cases, ranging from 10-min delivery to 1-day delivery.
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Why I Love Studying History
For a long time, I could not really say why I love studying history. I have no formal background in history nor liberal arts. I have been intrigued by history since I was young. Then, when I was a business student at Yale University, I spent a considerable amount of time studying at Yale’s Department of History.
I think now I may have some answers.
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Overseas–Listed Chinese Stocks — A market bottom between now and early 2022(?)
Update on KWEB: The prediction I made in July 2021, titled “Two Hours of Almost ‘Free’ Money,” has been proven to be correct by the market. KWEB reached $55 a share on September 7, 2021.
Full disclosure: I own KWEB the ETF. This article is NOT investment advice. Do your own due diligence.
I am increasingly convinced that the price collapse of overseas–listed Chinese stocks is probably coming to an end very soon. Take KraneShares CSI China Internet ETF (KWEB) as a market proxy for overseas–listed Chinese stocks. I believe the bottom is likely to appear between now and early 2022.
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Why I am bullish on DoorDash
[Full disclosure: I own DoorDash stocks. This is NOT investment advice. Do your own due diligence.]
I have been bullish on DoorDash since early 2021. Finally, I got some time to share my thoughts here on the blog. Because it is a short blog piece, I only have space to highlight a few key topics.
Bullish views
In many Asian countries, food delivery apps have fundamentally changed how people eat. These apps are convenient and affordable. In some cities, food delivery apps have achieved “cost parity,” meaning paying for food deliveries costs about the same as buying ingredients and cooking them at home! Bullish investors bet food delivery’s success in Asia can be replicated in the U.S.
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“Reactive” can be a good thing
[Full disclosure: I own the KWEB ETF. This is NOT investment advice! Do your own due diligence.]
“Reactive” is a word that sounds passive and negative. People do not like this word. In investing, I like to argue however, “reactive” can be a good thing.
To proactively predict the financial market is an extraordinarily hard thing to do. Proactively predicting companies’ futures is hard — that is why good stock pickers are rare. Predicting the market is harder — that is why there are extremely few investors who can make it big by just market-timing.
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Two Hours of Almost “Free” Money
This is NOT investment advice! Do your own due diligence.
Chinese equities suffered sharp selloffs due to policy-related concerns. KraneShares CSI China Internet ETF (“KWEB”), a popular Chinese ETF, declined by as much as 25% over the three-day period from last Friday to this Tuesday — a massive decline since KWEB has previously already declined by 40% from February to June! By Tuesday night, KWEB was down more than 55% from this year’s peak. See the chart above. What a financial “bloodshed”!
If one were watching the market close enough, he/she could discover an asymmetric opportunity during the Tuesday selloff. In a nutshell, between 11:30am and 1:30pm Tuesday (July 27, 2021), for KWEB, its exchange-listed long-dated call options were selling at a price so low that basically “guaranteed” investors great returns.
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