Here's How You Beat Buffett at His Own Game

Just invest like Warren Buffett.

C'mon, how many times has someone told you this before? He's the gold standard in investing, and I can't tell you how many times this sentiment is parroted to me on a daily basis.

Not that I can blame them or anything. After all, the Oracle of Omaha has created an eye-popping $80.6 billion over the course of his 87 years.

So when he quietly grabbed a stake in BYD just about nine years ago, hardly anyone recognized the move for the genius it was. At the time, the media was fixated on the burgeoning shale sector, which would quickly explode into what is considered the most important oil boom in U.S. history.

But I'm still shocked by how many investors haven't caught on yet.

As you know, BYD is an electric carmaker that also produces rechargeable batteries.

Truth is, I think he should be worth more right now - much, much more.

You see, Buffett made one slight miscalculation that will let you get one step ahead and beat him at his own game.

If your eyes aren't fixated on China, you're going to miss an investment opportunity that comes but once every several generations.

Last month's news will be the straw that broke OPEC's back.

You see, China announced a few weeks back that it was banning the sale and production of fossil fuel vehicles. Both France and the UK have made similar pledges.

And I have a feeling more than a few of you jumped on the Buffett bandwagon.

Most people did.

Considering that more than 28 million cars were produced in China in 2016, you can imagine that a company that makes electric vehicles might have some long-term value attached to it.

That's Warren Buffett's bread and butter, after all.

Moreover, his instincts to pick up BYD were spot on. Would you have been able to predict this kind of growth of new energy vehicles inside the world's largest auto market?

Here's a chart breaking down China's vehicle market over the last few years:

Since 2014, China's production of new energy vehicles has grown 591%!

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"If you aren't willing to own a stock for ten years, don't even think about owning it for ten minutes."

Well, we're quickly approaching Buffett's 10-year anniversary in BYD, and it turns out that China's announcement was an early present.

Even though the country's timeline is still unknown, the immensity of this situation should be clear to every investor looking to cash in on the upcoming transition away from fossil fuels.

Buffett's shares in the battery stock have surged 68% since September 8th, and with EVs only making up less than 2% of the world's fleet of cars, the growth in store for these battery stocks is nearly unfathomable.

Still don't think you can beat Buffett at his own game?

Well, I'll tell you one person who does know: Warren Buffett.

All you have to do is take a little piece of advice from his own mouth.

Look, there's one piece of the puzzle he hasn't accounted for...

Nobody has yet.

Make no mistake; our chance to beat Buffett this time directly involves his supply chain.

Without it, BYD is simply another battery maker with an uncertain future.

You see, Buffett has the same problem that the rest of the world's EV market has - that is, securing a safe, long-term supply of lithium.

If you think the world's lithium producers are going to cut him a deal just because he's worth $80 billion, think again.

According to some reports, the world's lithium supply grew just 14% in 2016, while prices exploded 74% higher.

Don't get me wrong here...

Warren Buffett is perhaps the most famous long-term investor in history. Yet his bet on the EV revolution has opened a massive window of opportunity for the smaller investor - like us!

Thing is, you and I aren't his enemy. We just plan on seizing the opportunity in his looming supply crisis, and, well, we just can't help but take a piece of the pie for ourselves.

It turns out that he may have an even bigger battle on his hands in the coming years. We'll delve deeper into this bitter rivalry next week.

Until next time,

Keith Kohl

@KeithKohl1 on Twitter

A trueinsider in the energy markets, Keith is one of few financialreporters to have visited the Alberta oil sands. His research has helpedthousands of investors capitalize from the rapidly changing face ofenergy. Keith connects with hundreds of thousands of readers as theManaging Editor of Energy & Capital as well as Investment Director of Angel Publishing's Energy Investor. For years, Keith has been providing in-depth coverage of the Bakken, theHaynesville Shale, and the Marcellus natural gas formations - all ahead of the mainstream media. For more onKeith, go to his editor's page.