Lin Yuan’s latest statement: For some industries, now is the time to buy; to make big money, you need to keep buying and holding.

Recently, private equity tycoon Lin Yuan had an exclusive exchange with a group of high-net-worth clients. His remarks were straightforward and far sharper than his usual comments on camera.

When discussing investment logic, Lin Yuan dissected “the essence of making money” point by point, and bluntly stated: Stock investing is "not opening for ten years, but when you finally open, you eat for ten years."

ZiShiTang obtained this "exclusive sharing" and organized his speech from a first-person perspective for readers.

Brilliant Quotes:

1. The stock market is like this all over the world: not opening for ten years, but when you finally open, you eat for ten years.

2. Whether a person can succeed at something mainly depends on their resilience, and whether they can persist.

3. In the stock market, if you want to accomplish something, you have to pay attention 365 days a year.

4. Investing is not much related to money, but rather to a person’s sense of meaning.

5. Many parents are always pouring cold water on their kids. Actually, when a person is passionate, you should let them go for it. Once you’re older, there’s nothing you can do—time won’t rewind.

6. “Companies related to food and drink have an extremely low probability of bankruptcy.”

7. You need to observe demographic changes. Many old industry logics no longer hold. Investing in some consumer goods today might have no future.

8. “Especially for industries related to the ‘mouth’, now is the time to buy. Only by constantly buying and holding, and waiting until a bubble appears, will you see huge returns. This is a certain trend.”

The Key to Making Money from Investment

We have to meet a lot of people each year. Last year, I met over 5,000 people, and more than 2,000 visited our company. Over the past week alone, we met more than 500 people. I’ve found that people actually follow the market’s heat when investing. When the stock market is hot, everybody is interested; when the market cools, many people stop coming.

I always say, whether a person can succeed at something depends on their resilience and persistence. I keep reflecting that whether or not a person can make money fundamentally depends on whether they can tell good from bad. If you can’t even distinguish between good and bad, you can't make money.

If people only come when the market is good, but stop coming when the market is bad, those people won’t make it. In the long run, truly successful entrepreneurs and hundred-year-old companies insist on persisting no matter the environment. This is very important.

I remember in 2006, I was very popular. Lots of clients sent their kids to me to train. At the time I said okay, but after two years, the bear market hit, and I didn’t see a single one of them again. In the stock market, if you want to get things done, treat it as a career. This is not a side job; you have to pay attention 365 days a year.

Not Opening for Ten Years, Eating for Ten Years When You Do

The stock market is like this everywhere in the world: not opening for ten years, but when you finally open, you eat for ten years. Thinking about making money every day is the wrong approach.

There’s no way all the money in the world can be made by just you. Many people say they’ve done this or that, but I ask them: do you have money? If not, then you haven’t succeeded. Results are what matter. If you can earn money, you’re successful; if you can’t, nothing else matters.

A couple of days ago I visited a listed company. It only started around 2017 or 2018, but is already listed and its market value exceeds 2 billion. I asked them how they select their project targets. They said they screened about 1,000 types down to 11, and only two ended up successful.

(Investment projects) This actually has little to do with money, but more to do with the meaning for people. I went with some friends and then asked them what their biggest takeaway was. They mentioned many things, but my takeaway was: what should the next generation do, that’s most important. If I were in my twenties today, and did nothing else, I’d definitely do something like this.

When Young and Passionate, Go Boldly

So the most crucial question for a person is to know what matters most today. Let me say a few more words here, because it’s my personal experience.

Young people must be careful not to easily dismiss others. Many parents are always pouring cold water on their kids. In fact, when someone is passionate, you should let them go for it. Once you’re older, there’s nothing you can do. Time won’t rewind.

So after visiting that Shanghai company, I also thought about how I should guide my children. As long as he’s interested, he should be supported, and he’ll take fewer detours. I often say our kids have our support, so it’s much easier for them than others.

Invest in Monopolies

Back to investment, the first thing I want to say today: the most important thing is to invest in monopolies. All competition brings risk; only exclusive businesses are safe.

Secondly, regarding financial indicators, I always stress the need for “anchored assets”—the more the better.

Many scholars don’t understand what anchored assets are. My understanding is simply: the cash in your pocket. No matter how much a person talks, if they don’t have cash, they're still poor. Those who don't lack big money but often run short on small amounts also aren’t qualified investors. In that state, investing is a mistake.

We stress this especially today because China’s economic trajectory is changing. If investors don’t have cash but still want to invest, then the risk is huge. Some entrepreneurs look impressive but don’t actually have cash. In the past decades, almost any investment could make money, but today is different. Now financial security matters more.

Also, watch for demographic changes. In this situation, many old industry logics no longer hold. Investing in some consumer goods today may have no future.

So, in summary: First, invest in monopolies, exclusive businesses. Second, invest in future large industries. Yesterday we saw robots—that’s a future direction. I’m here to learn and understand the world to come.

Aging Industry Is a Certainty

I firmly believe direction is more important than anything. Picking the right industry direction is what’s correct. Demographic trends are a real issue.

The marriage and fertility issues of today’s young people need attention. In the coming decades, population aging is a certain trend. I started considering aging issues more than ten years ago, and it’s an indisputable direction. Fifteen or twenty years from now, you can verify today’s judgment.

Currently, there are fewer than 30 million people in China over age 78, but in 25 years, that may rise to a major number. This is not just a Chinese issue, but a global pattern. The population peaks of those born in the 1950s, 60s, and 70s will gradually be entering old age, so aging industries are a sure track.

Most diseases in the elderly are hard to cure, only to delay. For example, kidney disease or cancer can only be postponed, not fully cured. The cost of prolonging life is extremely high; the medical expenses in the last few years of life may exceed the total cost of the rest of one's life. This means investments around aging and life extension are definitely correct.

True Results Show Over the Long Run

In technology, AI is a big direction, but I value persistence over the long term even more. My investment method is to hold for the long term, rarely selling stocks.

Some say this is foolish, but I believe real results show only over the long run.

Facts prove that persistence is correct. Companies I laid out more than ten years ago I still hold today. I often joke that this could make me one of China's richest people in the future.

Although it’s a joke, it’s not without basis. Others will eventually sell; I won’t.

Wait for the Bubble to Appear

Last week, there was a meeting in Chongqing with about 300 participants, including a leader from the local traditional Chinese medicine association. I told him about aging industry investment, and he couldn’t sleep that night. He came to the office again the next day to continue the discussion. He said I brainwashed him and now firmly believes this is the way to make a fortune.

I gave the example of China's famous traditional Chinese medicine brands. I own their products and have held them for a long time. Over the past two years, my investigation found that these medicines are not used much by ordinary people, but usage surges among those over 78 years old. Some patients take more than twenty pills a day. This difference in demand shows the huge space in the aging industry.

From an industry perspective, “mouth”-related industries are most stable. Over the past hundred years, companies linked to food and drink have accounted for about 79% of society's total profits. Other industries together only make up 25%. Steel and aviation once changed the world, but many giants have disappeared.

By contrast, companies related to food and drink have an extremely low probability of bankruptcy.

So investment must be clear: first is industry selection, second is growth potential. Many industries grow for a period but then disappear. Growth must be judged in conjunction with direction.

No Real Estate

Around 2017, I clearly said I would not touch real estate. Though most rich people in China made their money in real estate, I’ve always thought it’s wrong.

The largest real estate companies in terms of market value are all in China. Similarly, banks make money from interest, and all companies work for the banks; this model is unreasonable for society as a whole, so I don’t participate.

Investing requires common sense judgment.

Follow the Trend

Medicine and eldercare are definitely the right direction. The world's major pharma companies have market caps of 2 trillion or 3 trillion; our largest is just over 100 billion—a huge gap. China has an enormous population base; this equals ten-thousand-fold growth potential, and that’s not empty talk.

The essence of investing is to go with the trend. I’ve seen countless market downturns, but the real big money comes from continually adding positions when floating losses occur. If the stock price drops after buying, that’s normal. As long as the direction is right, keep investing and persist in holding.

Especially for “mouth”-related industries, now is the buying time. Short-term losses are unavoidable, but in the long run, only by buying and holding continuously and waiting for the bubble to appear will you get huge returns. This is a certain trend.

Risk disclaimerThe market has risks, investment needs caution. This article does not constitute personal investment advice and does not consider the special investment goals, financial status or needs of individual users. Users should decide for themselves whether any opinions, views, or conclusions herein suit their specific situation. Invest accordingly at your own risk.