Buffett & Munger's surprisingly simple mental model behind their success, Circle of Competence

The Circle of Competence mental model was developed by Warren Buffett and his business partner Charlie Munger. It is a model that describes the area of understanding that matches a person's skills, abilities, or expertise.
Buffett and Munger used the model to describe limiting one's financial investments away from areas you have limited understanding or expertise and instead focusing on areas where you have the greatest familiarity or edge. Part of the model involves the importance of accurately assessing one's own abilities relative to what one may think they might know.

#WarrenBuffett #CharlieMunger #MentalModel #cognitivebiases

🔥📢🔥
For a unique audio experience also be sure to listen to another project, The Infinite Knowledge Podcast. New audio essay episodes every week where we weave in multiple mental models or key big ideas from seemingly unrelated disciplines. It's like a free short audiobook every week. Available on nearly all major podcast platforms or visit https://infiniteknowledge.podbean.com/
🔥📢🔥

Resources, References, & Recommendations:
Articles:
https://en.wikipedia.org/wiki/Circle_...
https://fs.blog/2013/12/circle-of-com...
https://palladianpark.com/circle-of-c...
https://finance.yahoo.com/news/warren...
https://www.wealest.com/articles/circ...
Munger Circle of Comp. Quotes: https://getpocket.com/read/3345350537 or
https://tradebrains.in/best-quotes-by...
https://en.wikipedia.org/wiki/Dunning...

Books:
Poor Charlies Almanack: https://amzn.to/2lmFePT
The Almanack of Naval Ravikant - https://amzn.to/3peIKZd

Podcast:
https://clearerthinkingpodcast.com/?e...

----

*As an Amazon Associate I earn from qualifying purchases.

Become a member for perks like exclusive content:    / @progressleavesclues  

Bitclout:
https://bitclout.com/u/ProgressLeaves...

Support the channel:

Get the best quality PLC merch from AMAZON:
https://amzn.to/3gldqST

Wear some other merch:
https://teespring.com/stores/progress...