The most important thing, if you want to avoid a lot of silly mistakes, is knowing where you are competent and where you are not. Knowing your own competitive edge and doing so is very difficult because the human mind tries to trick you into thinking you are smarter than you are. – Munger. “I’ve lived long enough to learn that I don’t know most things. I do know a few things. As a result, I limit myself to investing in the few things I do know.”—Joel Greenblatt. Remember, in this frame, that “I only know that I know nothing”, a phrase that Socrates attributed to humility and the need to learn and understand that there is no absolute and true knowledge. In the context of stocks and investing, this phrase can emphasize that there are risks involved on all sides of an investment decision. By definition, investment is uncertain. No one can accurately predict the future performance of any investment.
Don’t be the smartest or the dumbest in the class. Every day, without exception, the specialized media on this and the other side of the pond highlight on their front pages the benefits of certain values: bargaining, bargaining, hits and other ways to get rich. stay away from it With patience, analysis, reflection and an open mind. Stroke your own ego and don’t fly the clever, arrogant, know-it-all flag. As The Irrational Investor @Position_Trader says, “Price your peace of mind in any case. The next time you feel unsettled, just ask yourself:” Does it matter enough to me that I have to pay for it? Should you lose your mental peace? “Sounds simple enough, but it works. Wise advice, for life and for the stock market”, told me a prominent manager, who provided me with the following link:
Tiho [email protected] points out that this should take advantage of the compounding effect in longer term results. A little progress does wonders in the long run. “You don’t have to be a genius… just a little bit smarter than everyone else, on average, over a long period of time.” —Charlie Munger Goes on: Are you solving a problem or solving the right problem? People often start thinking deeply before solving a problem whether they are really solving the problem or not. A lot of energy is wasted in solving some low-level problems instead of the bigger problems…”
“Good investment opportunities won’t come around often and they won’t last long. So you have to be prepared to act.” —Charlie Munger But to perform, you also need dry powder (optional). It comes with patience and never chases the previous rising valuation trend…”
“Failures often don’t survive. As a result, they are often overlooked and not discussed in depth. We perpetuate survivorship bias. A cure for us investors is to read financial history books. Those mistakes study those who were arrogant and naive before us. …”
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For its part, [email protected] notes that “everyone on Wall Street is smart enough that their talents offset each other and everything they know is already reflected in stock price levels.” ” -Benjamin Graham
written by:
Moses Romero
