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Collection: Charlie Munger - #43 'Be Aware of both Potentialities and Tension'


Video Link: https://youtu.be/MdiseqY0EA4


In this episode, Charlie Munger was asked that how does he balance the risk of potentially forego an opportunity or late to enter into opportunity for fear that's materializing?


In this episode, you’ll learn:

  • To be aware of both potentialities and tension in investing.

To check out all Collection: Charlie Munger <click here>

 

[Transcript]

(Source: https://youtu.be/X1Oi3esiry8)

AUDIENCE MEMBER 00:08

Hi Charlie, question for you over here. You’ve paraphrased Ben Graham in saying that good ideas are wonderful but you can suffered terribly if you overdo them.


CHARLIE MUNGER 00:19

Yes.


AUDIENCE MEMBER 00:21

How do you balance that against the risk that you potentially forego an opportunity altogether? Or are late to enter into opportunity for fear that materializing?


CHARLIE MUNGER 00:31

Well, the problem was thoroughly understood is half solved. The minute you point out there’s a big tension between good ideas yet over done so much they’re dangerous, and good ideas that still have a lot of runway ahead, once you have that construct in your head and start classifying opportunities into one category or the other. You’ve got the problem half solved. You don’t need me. You’ve already figured it out. You’ve got to be aware of both potentialities and the tensions.

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