We often read and hear quotes and commentary from Warren Buffett in the news, media, or from other investors, but seldom do we hear much of anything from Mr. Buffett’s number one investment sidekick and partner, Charlie Munger. Today, I’d like to share with you Charlie Munger’s 10 rules for investment success.
1. Measure Risk
All investment evaluations should begin by measuring risk; especially reputational risk
2. Be Independent
Only in fairy tales are emperors told they’re naked
3. Prepare Ahead
The only way to win is to work, work, work, and hope to have a few insights
4. Have Intellectual Humility
Acknowledging what you don’t know is the dawning of wisdom
5. Analyze Rigorously
Use effective checklists to minimize errors and omissions
6. Allocate Assets Wisely
Proper allocation of capital is an investor’s (and CEO’s) No. 1 job !
7. Have Patience
Resist the natural human bias to act
8. Be Decisive
When proper circumstances present themselves, act with decisiveness and conviction
9. Be Ready for Change
Accept complexity that cannot be removed
10. Stay Focused
Keep it simple and remember what you set out to do
Information Source: Poor Charlie’s Almanack: The Wit and Wisdom of Charles T. Munger, Expanded 3rd Edition
Blog: Alfred L. Angelici http://www.walnuthilladvisorsllc.com
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