Part 1: Better to Be Generally Right Than Precisely Wrong

The Common Error of Investors Selling Great Companies Too Early

Nick Sleep, co-founded Nomad Investment Partnership, a low profile legendary investor, compounded shareholders' capital at an annual rate of 20.8% and achieved a remarkable 921% return over 13 years, significantly outperforming the MSCI World Index’s 117%—almost nine times better. He often reflected on one significant mistake: prematurely selling his UK Stagecoach holdings, which he bought at 14p and sold at around 90p, before they later soared to 400p. This mistake was largely due to focusing too heavily on the initial purchase analysis and not enough on the long-term potential of the business. The resulting opportunity cost was substantial.

The greatest risk in long-term investing is the misanalysis of a company's future. This is particularly prevalent in the Malaysian stock market, where analysts often offer short-sighted, quarter-based precise target prices, making it easy to overlook the long-term compounding growth potential. This mistake has led Nick Sleep to consistently prioritize the 'destination' of a business over its immediate fluctuations. I also agree that he emphasizes that the most valuable insights usually arise from a 'deep understanding' of business fundamentals rather than merely from contrarian thinking. It is often better to be generally right than precisely wrong. Prioritizing long-term growth and compounding returns will ultimately yield more significant benefits for our portfolio. With this perspective, this article applies Sleep’s methodology to uncover this company with very high potential to become the next tenfold investment, akin to becoming a Malaysian Walmart in the retail industry.