I bought some NINE (Ninetowns) shares for the 3rd time last Dec. for two reasons:
1) It’s getting into B2B business. A successful example of B2B in China is Ma Yun’s Alibaba, which has done well (at least generated lots of buzz), and is planning to go IPO in Hongkong this year.
2) Duan Yongping, the founder of BuBuGao, the successful investor who won the bid to have lunch with Warren Buffett last year, bought sigificant shares of NINE last year.
But the fundamenatals of Ninetowns continues to deteriorate, as its license revenue gone after the customers got free software. It did made one more acquisition for a B2B software company, but it can not count on B2B revenue for a while. So I decide to sell my few shares today, amid a 17% loss. I used the money bought some SNCI shares.
Piggy back on big investors (even Warren Buffett) ususally won’t work, because each person has different investment objectives, and different understanding of this business. To me, software in China, B2B and international trade are just too hard to understand. I based on my “buy” decision mostly on my faith on some famous guys, which is not the right way to start. I’m glad I finanlly realized my mistake, cut my loss and ran away.