Charlie Munger made billions for Berkshire Hathaway, but he made investing mistakes too

Nati Harnik/AP

• Charlie Munger helped Warren Buffet build Berkshire Hathaway into an investment powerhouse.
• But Munger made mistakes too, and cited Alibaba and Belridge Oil as two of his biggest investing errors.
• Munger died peacefully in a California hospital early Tuesday. He was 99.

Legendary investor Charlie Munger was a shrewd investor who helped Berkshire Hathaway make billions.

But Munger — who died Tuesday at age 99 — has also admitted to making a few investing errors himself.

Still, he embraced his own mistakes, saying in a 2021 interview that it was important to learn from them.

“I just know that if I rub my nose in my own mistakes, I’m less likely to commit new ones of the same type,” he told the “Think With Pinker” podcast.

“So I just go through my life rubbing my nose in my own past mistakes. It works in training a dog and so I think it would work on me,” he added.

Here are the mistakes Munger has admitted to:

Alibaba was ‘one of the worst mistakes’ Munger made

Munger’s Daily Journal quadrupled its holding of Alibaba stock in the third quarter of 2021.

At the time, Alibaba’s shareholders were making a beeline for the exit door following Beijing’s crackdown on Jack Ma, cofounder of the Chinese e-commerce giant.

But Alibaba’s share price just kept slumping amid China’s flagging economy post-pandemic and intense sector competition. The stock has lost about three quarters of its value since it hit its peak in October 2020.

“I regard Alibaba as one of the worst mistakes I ever made,” Munger said at Daily Journal’s annual meeting earlier this year.

“I got charmed by the idea of their position in the Chinese internet; I didn’t stop to realize they’re still a goddamn retailer. It’s going to be a competitive business, the internet — it’s not going to be a cakewalk for everybody.”

Daily Journal halved its Alibaba stake in the first quarter of 2022.

Munger missed out ‘many billions’ from Belridge Oil

Munger purchased 300 shares of Belridge Oil, an energy company, in 1977, but didn’t snap up another 1,500 shares offered to him shortly after.

Oil giant Shell acquired Belridge Oil in 1979 for about 30 times the price Munger had paid for the company’s shares.

“It was one of the stupidest mistakes I ever made. Now, it doesn’t look on my record like I’m that stupid because I started with nothing and I have billions,” he said in the 2021 podcast. “But I would have had twice as many billions if I’d just made a different decision about Belridge Oil.”