Are Rag-To-Riches Stories Just A Dream In Investing?

One of the investors in Asia whom I deeply respect is Dato’ Cheah Cheng Hye. Many might not have even heard of his name, but Dato’ Cheah is currently Chairman of the largest asset management firm in Asia, Value Partners Group Ltd. The company, which is based and listed in Hong Kong, currently manages about US$10.7 billion.

Since the idea of value investing is relatively new in Asia as compared to in the US (the discipline originated from Benjamin Graham in the 1930s in the country), there have been debates on whether value investing actually works in Asia. I believe that the story of Dato’ Cheah and Value Partners provides strong evidence that value investing – the discipline of buying shares which are priced at less than their intrinsic business value –  does work even in the context of Asia.

The beginning

Dato’ Cheah had a humble beginning. He was born in Penang, Malaysia in 1954. With the early passing of his father, Dato’ Cheah started work at the young age of 12 to help support his family, selling pineapples at the market or helping clean up and serve dishes at a hawker stall.

After he graduated from secondary school, he became a reporter at The Star newspaper in Penang as he could not afford to further his studies. Subsequently, he went on to Hong Kong to work as a financial journalist before finally entering the investment industry.

In 1993, Cheah and his partner Yeh V-Nee co-founded the Value Partners Group and launched their flagship fund, Value Partners Classic Fund. As of 17 September 2014, the fund has gained a total of 2,421.1% for its investors – that translates into a heroic compounded annualised return of 17% over the past 21 years. To put those returns into perspective, a S$100,000 investment with them in 1993 would be worth S$2.52 million today.

What we can do for you

Today, Dato’ Cheah is a well-respected value  investor not just in Asia, but around the world. To me, his story personifies two key ideas: That the road to riches is not just a dream; and that value investing can be the source that brings you there, wherever you are in the world.

This is why we at The Motley Fool Singapore have created an easy guide for you in your quest to becoming a better investor. The guide, titled 10 Steps to Making a Million Singapore Dollars in the Marketis FREEClick here now for your copy!

The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Stanley Lim does not own any companies mentioned.