Clockwise from top: Hedge fund manager Zhao Danyang and his son Zhao Ziyang with billionaire investor Warren Buffett after placing the winning bid in a charity auction for lunch with Buffett. Buffett, the chairman of Berkshire Hathaway, handed his wallet to the younger Zhao and then whispered a stock tip after completing a series of television interviews. Buffett's power lunch is traditionally held at the high-end New York steakhouse, Smith & Wollensky. The restaurant donates $10,000 to the charity Glide for the pleasure of hosting the event annually. Warren Buffett and Wang Chuanfu, CEO of the auto and battery maker BYD, presenting a key to the millionth person to own a BYD car on Sept 27, 2010. [Photo/China Daily]

Seat at the table with 'Oracle of Omaha' is not cheap but it is for a good cause, Ma Liyao reports in Beijing.

Having hosted his annual charity "power lunch" for high-flying, well-heeled investors for the past 13 years, Warren Buffett may be forgiven for not remembering the name of each and every guest, despite their huge outlay to gain a seat at the table - this year's top bidder shelled out a cool $3,456,789 for the pleasure of spending three hours in the company of the chairman of the investment house Berkshire Hathaway.

However, one name the 81-year-old US investment guru is unlikely to forget is that of Zhao Danyang, who not only introduced the notoriously abstemious Buffett to the pleasures of China's famous, and famously expensive, rice spirit Moutai and the health tonic Dong'e Ejiao, but also changed the nature of the event forever.

Before 2008, when Zhao won his place at the table with a bid of $2.1 million, the lucky winner was allowed to quiz the "Oracle of Omaha", as Buffett is known, on topics ranging from shares and investment combinations to food, music, philanthropy and even girlfriends.

All that changed after Zhao, the manager of a Hong Kong-based hedge fund, took the chance to recommend two individual shares - the supermarket chain Wumart Commercial and the auto and battery maker BYD, both listed on the Hong Kong Stock exchange - to Buffett, who agreed to take a look at them.

That simple expression of interest moved the market, causing strong share-price volatility. Zhao's hedge fund, Pure Heart Asset Management, benefited to the tune of $16 million in the four days that followed the lunch as it offloaded shares of Wumart Commercial. Zhao wasn't the only winner, though, as shares in both Guizhou Maotai and Dong'e Ejiao also surged on the back of the association with Buffett.

As far as Zhao was concerned, the lunch came cheap. The man known as the "Godfather of Chinese Private Equity" reasoned that $2.1 million was a small price to pay, compared with the money he was able to earn from the lessons he learned during the three-hour meal.

"Successful investment revolves around making the right judgment at the right time. Talking to Buffett for those three hours helped me solve some problems that have been puzzling me for years. I'm very happy about that," he said later.

The "Buffett effect" proved to be short lived, however. Just two years later, Zhao had to apologize for the poor performance of the funds he managed.

In a 2010 letter to investors, he noted that Pure Heart Value Investment Fund's yearly return on investment was 0.5 percent, and Pure Heart Natural Selection Fund's yearly return was minus 8 percent.