In his own words
Munger on Opportunity
15 sourced quotes. All themes
“The wise ones bet heavily when the world offers them that opportunity. They bet big when they have the odds. And the rest of the time, they don't. It's just that simple.”
“You're looking for a mispriced gamble. That's what investing is. And you have to know enough to know whether the gamble is mispriced. That's value investing.”
“A few major opportunities, clearly recognizable as such, will usually come to one who continuously searches and waits, with a curious mind that loves diagnosis involving multiple variables.”
“Capitalism should expect to get a few big winners by accident.”
“The problem around here at the moment is that we have more money than we have brilliant ideas. But there are worse problems than that.”
“Bridge players know about opportunity cost. Poker players know about opportunity cost. But MBA faculty members and other important people, they hardly know their ass from a plate of hot squash.”
“There's a model that I call "surfing" — when a surfer gets up and catches the wave and just stays there, he can go a long, long time. But if he gets off the wave, he becomes mired in shallows.”
“The first rule of fishing is fish where the fish are, and the second rule of fishing is don't forget rule number one. And in investing it's the same thing. Some places have lots of fish and you don't have to be that good a fisherman to do pretty well. Other places are so heavily fished that no matter how good a fisherman you are, you aren't going to do very well.”
He frames 'fish where the fish are' as an old fishing rule; the over-fished-waters application to investing is his.
“It's like an Easter egg hunt with too many hunters and not enough eggs. So you value investors, look around the room. There are a lot of hunters. So if you're having trouble, please join the club.”
On a picked-over value-investing environment.
“If a thing is despised enough and ignored enough, you can run a Geiger counter over it and find a few things that make it go click.”
On a deep-value investor finding bargains in despised, ignored markets.
“I think life is a whole series of opportunity costs. You know, you've got to marry the best person who is convenient to find who will have you. Investment is much the same sort of a process.”
“American investors are missing China. It just looks too hard, sitting in Omaha, to outsmart the Chinese market. But I think you're absolutely right. It's where they should be looking.”
Agreeing with a shareholder who argued Chinese stocks were the better value.
“The trick in life is, when you get the one, or two, or three that is your fair allotment for a life, you've got to do something about it.”
The moral of his 1962 Al Marshall oil-royalty windfall — 'the trouble is it only happened once.'
“The most extreme mistakes in Berkshire's history have been mistakes of omission. We saw it, but didn't act on it. They're huge mistakes — we've lost billions. And we keep doing it.”
On Berkshire's biggest errors — the things it saw but didn't buy.
“The opportunities that we all remember came from a demoralized period when about 90% of the natural stock buyers got very discouraged with stocks. That's what created the opportunity for these fabulous records that my generation had.”
On why his generation's investing records are hard to repeat.