On September 25th, the ChiNext Index delivered an impressive performance, rising 1.58% for the day and reaching 3,266 points intraday, continuing to hit new three-year highs. Both Shanghai and Shenzhen markets gained momentum with strong volume in the morning session, with technology sectors continuing to lead gains and non-ferrous metals showing active performance. Gaming, AI applications, and controllable nuclear fusion sectors posted strong advances. Notably, the lithium battery sector surged significantly, with the leading lithium battery company reaching historic highs, briefly surpassing Moutai's total market capitalization - a development of significant signal importance. Previously, technology leaders had substantially outperformed, once exceeding liquor leaders, which itself indicates the increasingly evident trend of economic transformation. With the arrival of peak delivery season for power batteries and explosive demand for energy storage batteries, the lithium battery sector has rallied strongly recently, with solid-state batteries becoming a particular focus for capital. While traditional consumer blue-chip stocks maintain stable earnings growth, their future growth pace is expected to moderate, resulting in lackluster performance this year. Meanwhile, technology sectors benefiting from economic transformation have surged significantly, creating strong wealth effects. From chip leaders' stock prices once exceeding liquor leaders to today's lithium battery leader's market value briefly surpassing liquor leaders, these developments indicate that China's economy is currently undergoing transformation, with capital optimistic about the prospects of technology innovation sectors and high-end manufacturing that benefit from economic transformation, driving strong performance.

Value investing requires keeping pace with the times and advancing with them. Warren Buffett's investment approach is similarly not rigid or inflexible. Previously, Buffett rarely allocated to technology stocks, believing that tech stocks typically lead for three to five years and struggle to maintain sustainable competitive advantages, as technological progress could breach existing tech companies' moats. However, Buffett's most profitable single stock has been Apple, which has contributed over $100 billion in unrealized gains to Berkshire Hathaway. At this year's Berkshire Hathaway shareholder meeting, Buffett humorously remarked that Tim Cook has created far more profits for Berkshire Hathaway shareholders than he has, noting that Cook has attended the shareholder meeting in person for several consecutive years. Buffett's value investing adapts flexibly to changing times. When he allocated to Apple, it was already the world's largest company by market capitalization. When Buffett confirmed it met his stock selection criteria while having significant growth potential, and with the iPhone giving Apple its technology attributes, despite Apple's already substantial market cap, Buffett was confident enough to take a heavy position - at one point allocating 50% to Apple - thereby achieving over $100 billion in unrealized gains. Buffett has said that a stock's value doesn't depend on how much it rises, but on how much you buy. For quality leaders and companies you're confident about, being willing to take heavy positions generates returns far exceeding those small-cap stocks that may have large percentage gains. This is especially true for large capital. Of course, when Apple's stock price rose substantially and developed some bubble characteristics, although Buffett continued to favor Cook and Apple, he still significantly reduced his position, cutting holdings by half to realize profits. This demonstrates that Buffett's value investing is both forward-looking and highly flexible.

When investing in stocks, Buffett studies fundamental factors and hopes to hold long-term. However, he will sell without hesitation under three circumstances. First, when the invested company experiences fundamental deterioration - for example, when he invested in airline stocks but later sold decisively when the pandemic severely impacted the aviation industry. Second, when valuations become excessive and create bubbles, Buffett will sell timely - his significant reduction in US stock positions over the past two years reflects concerns about high US stock valuations. Third, when finding better companies within the same industry, Buffett will rotate positions - for instance, he once heavily allocated to IBM among tech stocks, but later realized IBM had limited opportunities in mobile devices and followed renowned value investor Duan Yongping's advice to allocate to Apple, achieving better returns. Buffett's willingness to accept good advice is worth learning from.

Currently, driven by both policy and capital factors, A-shares and H-shares are experiencing a bull market rally. The trend is gradually establishing, and this bull market has the potential to continue as a prolonged, steady bull market. Recent sustained corrections in US stocks while Chinese indices rise against the trend reflect China's breakthroughs in technological innovation, including advances in semiconductors, large language models, and GPUs, significantly boosting global capital's confidence in Chinese assets. Multiple foreign investment banks have recently published bullish reports on Chinese assets. The process of Chinese asset valuation recovery is ongoing, with obvious valuation advantages compared to US stocks, and many assets still having significant room for valuation improvement. Therefore, for future markets, investors are advised to maintain confidence and patience, positioning in quality stocks or quality funds to capture this historic investment opportunity from Chinese asset valuation repair and achieve favorable investment returns.

(The author is Chief Economist and Fund Manager at Qianhai Open Source Fund)