💸 Li Lu's Reading List

Today is Dividend Day.

The series where I teach you 5 things about dividend investing in less than 5 minutes.

1️⃣ Circle of Competence

The image illustrates Warren Buffett’s idea of Circle of Competence.

It is the mental boundary between what you actually understand and what you only think you know.

To be a successful investor, you don’ have to know the most.

You have to know the limits of your knowledge, and respect the boundary.

Source: Dividendology on X

2️⃣ The Feynman Technique

The Feynman Technique can help you learn quickly, and figure out what you don’t know.

When you explain a complex idea in simple terms, you’ll immediately figure out the gaps in your knowledge.

These gaps also define the exact boundary of your Circle of Competence.

If you can’t explain a business or investment to a child, you don't understand it yet.

Source: Reads with Ravi on X

3️⃣ An Investing Quote

How do you make your Circle of Competence bigger?

Or make it easier to explain complex things in simple terms?

Charlie Munger says the answer is to read.

A lot.

“In my whole life, I have known no wise people (over a broad subject matter area) who didn’t read all the time – none, zero.”

- Charlie Munger

4️⃣ Li Lu’s Reading List

For what to read, we can look to the man Munger famously called “the Chinese Warren Buffett.”

Li Lu is the founder of Himalaya Capital and the only outside manager Munger ever trusted to manage his family's personal wealth.

His book list is a great place to start if you want to learn about investing, the markets, and capitalism.

Click on the image to see the whole thing.

Ronit Pereira@Ronitper

Li Lu’s list of books is a goldmine for investors. Bookmark it 🔖

4:21 PM · Mar 7, 2026 · 26.1K Views

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4 Replies · 100 Reposts · 530 Likes

5️⃣ Example of a Dividend Stock

Our example stock is the only new buy on Li Lu’s latest 13-F filing.

It doesn’t pay dividends, but it does return a lot of capital to shareholders through buybacks.

That makes it a Cannibal Stock.

Crocs designs and sells foam footwear and casual shoes through a global network of wholesale partners and direct-to-consumer retail channels.

Key numbers from Fiscal.ai:

• FCF Margin: 16.3%

• Forward P/FCF: 8.5x

• Buyback Yield: 10.5%

Source: Fiscal.ai

Used sources

• Interactive Brokers: Portfolio data and executing all transactions

• Fiscal.ai: Financial data

Disclaimer

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