Pabrai, known as India's "Warren Buffett," held a heavy position in Micron for six years; after selling, the stock rose more than 15-fold over the next two years, costing him approximately $2 billion in missed gains. SK Hynix also sold too early. Recently, in a media interview, he personally reflected on his most painful trading mistake: "I visited Samsung multiple times and held shares in SK Hynix. Unfortunately, I violated my own principles by selling a company I should have held forever."
Spent nearly $5 million on lunch with Buffett, but this Indian "Buffett" missed out on $2 billion in gains from Micron.
Mohnish Pabrai, a disciple of Warren Buffett and a globally renowned value investor, acquired Micron in 2017 and sold his position in September 2023, earning only about a one-fold return; after his sale, Micron’s stock price rose more than 15-fold over the next two years, resulting in an estimated missed profit of approximately $2 billion. He also sold too early on SK Hynix.
On June 22, he reflected on some of his most painful trading mistakes on the Korean talk show "Knowledge Inside": "Unfortunately, I violated my own principles and sold a company I should have held forever."
The Pain of Liquidating: Held for Six Years, Sold Just Before Takeoff
Pabrai established a position in Micron in 2017, and at one point, the position peaked at 77%. During the interview, when asked about the Korean stock market, Pabrai expressed his regret.
Although he did not explicitly mention his specific trading actions regarding Micron, Papale discussed on the show that he had done extensive research—traveling to Seoul to meet with SK Hynix management, visiting Samsung executives, and engaging in in-depth conversations with Micron’s Indian-American CEO. His core reasoning was that the global memory market has ultimately consolidated into three players—Samsung, SK Hynix, and Micron—with an oligopolistic structure that is stable, competition that is becoming more rational, and promising profitability.
He even specifically consulted Buffett and Munger on this. Papale recalled: "Munger and Buffett told me that after studying Coca-Cola bottlers worldwide, in 95% of regions, if only two remain, they both make substantial profits—only in a rare 3% to 5% of cases, where the parties are naturally hostile, do they drive each other into bankruptcy."
In 2023, Samsung announced an increase in production, leading Park to conclude that the supply-side thesis had been undermined, prompting him to liquidate his position.
But by then, ChatGPT had already been released, and the surge in demand for HBM (High Bandwidth Memory) was on the horizon.
Two years after liquidating, Micron's stock price increased more than 15-fold.
I shouldn't have sold them.
Micron is not his only regret.
SK Hynix also sold too early. In the interview, he directly stated: "I visited Samsung multiple times and held investments in SK Hynix. Unfortunately, I broke my own rule by selling these companies when I should have held them forever."
His assessment of South Korea’s semiconductor industry remains clear: “SK Hynix and Samsung’s memory businesses are highly protected sectors.” He explained that the memory industry once had as many as 20 companies fiercely competing and undercutting each other’s prices, all of which eventually went bankrupt, leaving only three. “It’s nearly impossible for new entrants to join—patent barriers, engineering talent reserves, and process complexity mean it would take 10, 15, or even 20 years to enter.”
For investors who still hold South Korean semiconductors, his advice is straightforward: "If you already own them, don't sell. The party has just begun."
This statement is also, in a way, meant for myself.
What did Buffett buy at his lunch?
In 2007, Paobai won the opportunity to have lunch with Warren Buffett for $650,000 (at the exchange rate of approximately 7.6 that year, equivalent to about RMB 4.94 million)—less than one-third of his psychological budget of $2 million.
He said his only goal at the time was: "My entire agenda was to thank Mr. Buffett in person."
But lunch exceeded expectations. He told Buffett that his wife was truly enamored with Munger. Buffett immediately accepted the challenge, claiming he would arrange a lunch with Munger so they could see that he was the better dining companion. Two days later, Pabale indeed received an email from Buffett’s assistant scheduling the meeting.
At that lunch, I gave Buffett a 15 out of 10—partly because he got things done.
The relationship with Munger was thus established, and thereafter Pabla visited his home with his family every three or four months.
Three bottom lines, 213 checklist items
Pabrai has adopted an investment checklist method inspired by the aviation industry—after a plane crash, regulators review the causes and update procedures; he likens investment losses to plane crashes, turning each loss into a new item for his checklist.
His list currently contains 213 questions. He has distilled three core principles for retail investors:
First, no leverage. “The number one reason investors lose money is leverage—companies taking on too much debt, or investors borrowing money to buy stocks.” He cited the founder of IKEA as an example: the company has never borrowed a single euro in its 70-year history, “because we owe no one, so no one can stop us.”
Second, the durability of the moat. It’s not just about whether a company has a competitive advantage, but how long that advantage can be sustained. He uses AmorePacific as an example: although the brand has recognition, there are many competitors and consumers continuously seek better products, making the moat unstable.
Third, the character of management. “Do they love money, or do they love the business? Loving money is fine, but they must not be greedy.”
For the vast majority of people, his conclusion is simpler—“Over 99% of investors should just buy the index.”
When wealth is lost, nothing is truly lost.
At the end of the interview, Pabole spoke of his ultimate goal: to donate all his money the day before his death, which he estimated using AI to be June 11, 2054. He said, “I don’t really care about money—once your wealth surpasses a certain point, it no longer holds practical meaning. I’m playing a game.”
When wealth is lost, nothing is truly lost; when health is lost, something is lost; when character is lost, everything is lost. Therefore, don’t worry too much about wealth, pay a little attention to health, and devote all your energy to building character.
