Experienced Investor Lo Kheng Hong Reveals 32 Years Ago He Purchased Stocks Didn't Have Knowledge, Just Joined In

Lo Kheng Hong. (Photo: Doc. IDX)

JAKARTA - Seasoned stock investor Lo Kheng Hong (LKH) shared his experience regarding strategy in choosing a stock. He admits that he prefers a value investing strategy.

So what is value investing? According to the man who is familiarly called Pak Lo, this term is a strategy to buy company shares where the market price is much cheaper than the company's intrinsic value.

"That is, when I get a Mercy that is sold at Avanza prices. Of course I will buy. That is the simplest method if I find a Mercy that is sold at Avanza prices, I will definitely buy it," said Lo Kheng Hong in an Instagram video upload @lukas_setiaatmaja, quoted Thursday September 2nd.

He further compares, if in the real world, one will never meet someone who is willing to sell Mercy at the same price as Avanza.

"But in the stock market, there are a lot of Mercy sold for Avanza. So, that's like value investing, investing based on value," explained the man who is referred to as Indonesia's Warren Buffet.

Lo Kheng Hong recounted when he first invested in stock instruments, 32 years ago to be exact. At that time he admitted that I was completely blind.

"If Warren Buffet bought stocks when he was 11 years old, but I bought stocks when he was very late, 30 years old, very late," he said.

In that period of 32 years ago, he did not understand about stocks, so he bought stocks without any knowledge at all.

"At that time my strategy was not value investing, but my first strategy was to buy IPO shares, when I sold the listing. That was my strategy, that was 32 years ago," he said.

At that time, LKH saw that many shares of companies that carried out initial public offerings (IPOs) rose in price. Seeing this, Lo Kheng Hong bought shares during the IPO and then when the listing was sold.

"The first stock I bought was Gajah Surya Multifinance. I thought the demand was very strong, only a few were selling, when listings would definitely go up, it wasn't science," he said.

This is due to high demand and low supply, not making prices increase but decrease. As a result, Lo Kheng Hong had lost twice because he chose the strategy 32 years ago.

"So actually the first time I bought a stock, the strategy was not value investing, but buying an IPO and selling it when it was listed and had no knowledge at all, just following along," he explained.