Jack Ma Yun, founding chairman of Alibaba Group Holding Ltd., made a spectacular speech in Hong Kong recently.
Ma said he does not care about a person’s résumé when hiring.
In some cases, he said, an MBA course turns a smart person stupid, since such courses only teach about successful cases. MBA students end up being overly confident that what they learn in class will work in the real world.
New recruits at Alibaba are told to forget what they learned in school and immerse themselves into the company’s culture.
It’s the same with financial analysts, who have been taught to look at fundamental factors like how the stock market works, currency factors and a company’s links with the broad economy, Ma said.
It’s a tough job for analysts to sit in an office and draw conclusions on how a company’s stock will move by digging into public information.
It might work better, he said, if they paid frequent site visits to the target company and talk more with its managers. Armed with such first-hand information, analysts could stand out among their competitors.
Some people think billionaires are just lucky, since even pigs can fly in a storm, Ma said. However, those pigs may fall apart after the storm, as pigs are not supposed to fly.
The same applies to trend followers in the financial industry, he said.
When the whole market is going after blue chips, these people will follow suit. If the market trend shifts to small-cap shares, they will do likewise.
They place bets on warrants in the hope that “little strokes fell great oaks”. And they look for fast money by speculating on futures. Options are too complicated.
If this doesn’t work, then just switch the bet to foreign exchange or gold.
In fact, all these investment products or instruments can be profitable if they suit you, Ma said. But as the veteran investor André Kostolany said, speculation in the financial industry is not for everyone.
[Editor’s note: Kostolany once said: “Who has a lot of money, can speculate. Who has little money, must not speculate. Who has no money, has to speculate.”]
Ma said the wisdom of successful people has been gained from the numerous mistakes they’ve made.
You could make mistakes every day in the financial sector, and all these mistakes you’ve made will become valuable assets and help you get around these mistakes in the future. The more you fail, the more you learn.
He also made the great point that information technology (IT) was for yesterday, data technology (DT) is for today and tomorrow.
IT is self-benefiting, and you can make money after you become an industry leader.
However, DT should benefit others and help them make money, which will help you make money later.
In the era of information overload, data itself has very little value, because it is easily available, he said.
However, in the era of data technology, the value of the data or information will be obtained from data crunching and deep analysis. That will benefit the users and the businesses themselves.
This article appeared in the Hong Kong Economic Journal on Feb. 6.
Translation by Julie Zhu
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