Charlie Munger
Charlie Munger's framework turns an investing idea into a decision memo: what to check, what to avoid, and what would change your mind. Use the 72 principles below as a checklist—not as buy/sell signals—and verify any numbers or quotes with primary sources. If you're new, start with Value Investing to frame business quality, valuation discipline, and risk, then browse topics to find the rules that match your situation. Pair each principle with a concrete trigger so you can review whether you followed the process after the decision.
- Start with the principles as questions (not trade signals).
- Write down your thesis, risks, and “what would change my mind”.
- Cross-check with scenarios, filings, and your own data sources.
Educational only. This is not investment advice.
"Invert"
About Charlie Munger
Charles Thomas Munger (January 1, 1924 – November 28, 2023) was an American businessman, investor, and philanthropist. He served as vice chairman of Berkshire Hathaway and was Warren Buffett's closest partner for over five decades. Munger was renowned for his multidisciplinary approach to investing, advocating for the use of mental models from various fields including psychology, economics, physics, and biology. His concept of "elementary worldly wisdom" emphasizes the importance of building a latticework of knowledge to make better decisions. Known for his wit and directness, Munger famously advised investors to "invert, always invert" – approaching problems by considering what to avoid rather than what to pursue. He helped transform Buffett's investment approach from pure value investing to focusing on wonderful businesses at fair prices. Munger's speeches and writings, particularly those compiled in "Poor Charlie's Almanack," have influenced generations of investors and business leaders with their emphasis on rationality, ethics, and continuous learning.
Core Investment Principles
Stay Curious
Nothing has served me better in my long life than continuous curiosity.
→Pay Fair for Quality
A great business at a fair price is superior to a fair business at a great price. The first $100 million was hard, after...
→Opportunity Cost Valuation
The whole trick of investing is to find a good business with a good management team at a fair price. Then leave it alone...
→Know the Edge of Competence
Knowing what you don't know is more useful than being brilliant. If you know the edge of your competence, you're way ahe...
→The Folly of Crowds
The idea of excessive diversification is madness. Wide diversification, which necessarily includes investment in mediocr...
→Browse Charlie Munger's Principles by Topic
Famous Quotes
"always invert."
"The big money is not in the buying and the selling"
"but in the waiting."
"Spend each day trying to be a little wiser than you were when you woke up."
"It is remarkable how much long-term advantage people like us have gotten by trying to be consistently not stupid."
