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....
"Show me the incentive and I'll show you the outcome. Never, ever, think about something else when you should be thinking about the power of incentives."
Incentive structures drive all business outcomes.
Read Full Analysis →"I don't invest in what I don't understand. And I don't invest in things where I can't see durable competitive advantages. If you don't have a durable competitive advantage, don't compete."
Only invest where competitive advantages are clear and lasting.
Read Full Analysis →"Over the long term, it's hard for a stock to earn a much better return than the business which underlies it earns."
A stock cannot permanently outperform the business that underlies it.
Read Full Analysis →Charlie Munger has 3 key principles on business judgment. The most important one is "Management Quality Matters" — Show me the incentive and I'll show you the outcome.
Charlie Munger applies business judgment through several key principles including "Management Quality Matters" and "Seek Durable Advantages". These principles guide practical investment decisions and have been tested across decades of market cycles.
Charlie Munger's approach to business judgment is distinguished by a focus on long-term thinking and fundamental analysis. With 3 specific principles in this area, Charlie Munger provides a comprehensive framework that investors at any level can study and apply to improve their decision-making.
