About Dola Capital
Dola Capital is a value investing firm run by me. Our goal is to safely grow the firm’s capital over time.
What do we do?
We search for undervalued companies and mis-priced situations on a bottom-up basis, one investment at a time, in places we think we have an edge. We believe our current advantages are size, flexibility, structure, and long-term thinking.
Our small size allows us to invest in places with less competition (e.g. illiquid and small cap stocks).
Our firm’s structure, modeled after Buffet’s early partnerships, allows us to be take advantage of market volatility, and make long-term investments that may take some years to work.
Flexibility allows us to be opportunistic and invest in markets and situations where we think there are more opportunities. In recent years we have found value in Mexico, where we think there is less competition.
Finally, our long-term approach allows us to only act when great opportunities present themselves, otherwise we prefer to hold cash.
How do we do it?
We pursue attractive investment results by focusing on risk. Investing only in situations that have a margin of safety, which helps mitigates downside risk and provide an attractive upside.
Why does it work?
We believe that over the long-term it is beneficial to focus on risk first, rather than upside, because it reduces our chance of losing money and by itself takes care of the potential upside of the investment. A company that has a NAV of $20 and last month was at $10 and is now at $5 is now less risky and also has more upside. We also favor this approach because of the nature of compounding–a large loss is very difficult to recover from.
Results
Period: 2019 - 2024
Overall Gain: 430.4%
Compounded Annual Gain: 32.06%
“As a securities investor, you can watch all sorts of business propositions in the form of security prices thrown at you all the time.
For the most part, you don’t have to do anything other than be amused. Once in a while, you will find a ‘fat pitch’ that is slow, straight, and right in the middle of your sweet spot. Then you swing hard.
This way, no matter what natural ability you start with, you will substantially increase your hitting average.”
- Li Lu
About Me
I am from and currently live in Monterrey, Mexico. I studied Computer Science at Tec de Monterrey.
I am very passionate about entrepreneurship, when I was sixteen years old I founded Dola, a footwear company, where I learned how to operate a business. For 3 years I designed, sourced, and marketed footwear; achieving sales of $30,000 during the whole period.
In 2019, I discovered value investing through Benjamin Graham’s Intelligent Investor. Since then, I have studied the lives of Buffet, Munger, and Mohnish Pabrai to become a better investor and person. I love analyzing and researching businesses and the connection that investing has to other disciplines like history, biology, psychology, economics, and mathematics.
What can you expect from this newsletter?
One deep dive every month, case studies on super investors, and weekly insights on investment topics.
I will not disclose whether I hold a position in the stock. Nevertheless, I will provide our investment thesis when I come across an exceptional company.
I must emphasize that subscribing to this website solely for hot stock tips is not encouraged.
My primary objective is to comprehend, analyze, and produce in-depth analyses of businesses.
