Charlie Munger's Key to Success in Life and Investing: The Circle of Competence | Exploring Markets

Charlie Munger's Key to Success in Life and Investing: The Circle of Competence

Charlie Munger and Warren Buffett have been business partners and friends since the beginning of Berkshire Hathaway.

They have been immensely successful together and there's one aspect that both Munger and Buffett attribute to all of their success -- The Circle of Competence:
"Confucius said that real knowledge is knowing the extent of one’s ignorance. Aristotle and Socrates said the same thing. Is it a skill that can be taught or learned? It probably can, if you have enough of a stake riding on the outcome. Some people are extraordinarily good at knowing the limits of their knowledge, because they have to be. Think of somebody who’s been a professional tightrope walker for 20 years – and has survived. He couldn’t survive as a tightrope walker for 20 years unless he knows exactly what he knows and what he doesn’t know. He’s worked so hard at it, because he knows if he gets it wrong he won’t survive. The survivors know. 
Knowing what you don’t know is more useful than being brilliant." - Charlie Munger


Source:
- A Fireside Chat With Charlie Munger (WSJ, Jason Zweig)