In 2021 I bought a star fund and later lost half of it. I am the one who got trapped at minus 50%, and I intend to remember this moment for the rest of my life. What I want to remember isn’t the pain. It’s a principle: every piece of evidence that made me bet came from a rearview mirror.
The Rearview Mirror
It started with a question: doesn’t the Sharpe ratio feel like inspecting an asset through a rearview mirror? It measures how much return you got per unit of risk — but every number it uses is historical net-asset value. My fund’s Sharpe was around 1.2 in 2019 and 2020, with annual returns of 55% and 95%; by 2024 the same figure was negative. The metric hadn’t become false; the road had changed. The flat, straight road in the mirror only ever described what was behind you.
The money flows were harsher. In early 2021, more than 80 billion yuan poured in near the fund’s 3.5-yuan peak; when the net value fell to 1.5, the late entrants were commonly down forty to fifty percent — people using 2020’s rearview mirror to predict the road after 2021. The counterintuitive ledger: those who bought low in 2018–2019 and held made more than two and a half times their money. The fund itself never changed. Only the price people paid for it changed.
Labels Are Rearview Mirrors Too
After losing the money I reviewed my case and pinned the label on myself: chase Zhang Kun in ‘19 and I was a value investor; chase him in ‘21 and I was blindly trusting a fund manager — either way, it’s the rearview mirror. Same person, same holding style, same vocabulary. Entering in 2019 is called conviction; entering in 2021 is called stupidity. On what basis? The subsequent price. You cannot judge the motive at the time without consulting the price that came later.
That’s scarier than the loss. Because value investor as an identity is, before the fact, only a set of constraints: high concentration, long holding, pricing a company as if buying it whole. Whether the word becomes an honor or an insult is stamped in afterward by price. The actions were identical at the time; only the rearview mirror can tell you which one counts.
Unplayed Cards
The way out isn’t a better mirror. It’s a different concept: the card table. Tencent hasn’t even played its hand yet, and you’re saying it failed — as long as WeChat is one swipe to the right, and that isn’t AI, Tencent hasn’t played its hand. Declaring failure before the cards are turned, and claiming you knew it all along after they’re turned, are the same arrogance — both come from mistaking the rearview mirror for a verdict.
The card-table concept carries a pricing rule: pay separately. The 2021 purchase was paying a sixty-times price for a card that had not been turned — booking “the core-asset narrative has already won” as if it were face-up. Years later the market prices Tencent at a mid-teens multiple, which is precisely not counting the unturned card at all. Landed cash flow and unplayed cards are two different things, and their prices should be written in two columns.
Closing
I still look at Sharpe ratios and track records — but strictly as a rearview mirror. A mirror is a necessity: reversing, checking blind spots. It just has one permanently blank corner. The rearview mirror never shows the word ahead. For that, I accept exactly two things: turned cards, and landed money.
