320- The Best Munger Quotes - Part 3
b'\\u201cSpend each day trying to be a little wiser than you were when you woke up.\\u201d \\u2014 Charlie Munger\\n\\nThat assertion is so powerful, but it\\u2019s easy to overlook how critical it is. The whole idea of Rule #1 Investing is researching and learning about companies that you love, and buying stocks at attractive prices. Part of researching a company is ensuring it has a margin of safety, good management, meaning to you, and lastly, a moat\\xa0\\u2014 or competitive advantage.\\n\\nLet\\u2019s focus on moat, for example. Charlie Munger loves Coca-Cola. He said that \\u201cCoca-Cola is the perfect business because it has this gigantic durable competitive advantage, or moat, which gives it predictable cash flow.\\u201d This allows us to figure out what the future cash flow will be and value the company today, so we know whether we can buy it on sale or not.\\n\\nYour job as an investor is to research industries you already understand, so you can recognize companies with strong moats. An example of a brand moat is Harley-Davidson\\u2019s notorious lifestyle branding. This approach has huge potential for brand building, and Harley is brilliant at it. They\\u2019ve built a lifestyle around the Harley-Davidson culture which will always be tough for competitors to compete with. These companies don\\u2019t come around often.\\n\\nCharlie Munger believes there are only a small number of real opportunities to get very high returns with very low risk. Maybe 20 in a lifetime. He said that if you remove the 10 best deals Warren and he ever did, Berkshire would have average market level performance. The only way to get those kinds of returns is to wait for the right opportunity to come along.\\n\\nIn this episode of the InvestED podcast, Phil and Danielle discuss more of their favorite Charlie Munger quotes.\\n\\nLearn how to pick Rule #1 approved stocks with my\\xa0Four Ms of Successful Investing Guide! Click the link here to download: https://bit.ly/3puoNO4\\n\\xa0\\nLearn more about your ad choices. Visit megaphone.fm/adchoices'