Jota, 28, joined Liverpool in 2020 for a then Wolves record for £45m.
"In the last nine or eight years, I think we shouldn't have sold Diogo Jota," the Wolves chief admitted on the Business of Sport podcast. "At that time, I spoke with Nuno (Espirito Santo) and we may sell one of the players, maybe Diogo, Adama (Traore), whatever.
"Then Nuno chose Adama to stay, because he thinks maybe Adama was so important for how he played. So we sold Diogo. Of course, at the time, Diogo was injured a little bit too much, you know?
"So he was injured for two months, then two months again or whatever, and then not playing so well in the last three, four months for us.
"But he went to Liverpool, he did so well, and I was very happy for him. He was a very good guy and a smart boy. But if you ask me if I can change the history, I wouldn't have sold him."