Advantage Quote by Charlie Munger
“We may well have a competitive advantage buying decent businesses at decent prices. But they won't be fabulous businesses and fabulous prices. There's too much competition and money out there, with many buyout specialists.”
About This Quote
Source Interview: CNBC, 2018
Buying solid businesses at reasonable prices offers a modest edge, but true bargains are scarce due to intense competition and abundant capital.
In simple terms: Good deals are hard to find because many are looking.
Key Takeaway
Seek value, but manage expectations.
Themes
investment
competition
valuation
market dynamics
Mood
analytical
cautious
Type
practical
strategic
When to use this quote
- stock selection
- private equity
- M&A
- portfolio construction
- risk management
Key Concepts
efficient market hypothesis
value investing
Questions to Reflect On
- Is a modest advantage worth the effort?
- How can you differentiate in a crowded market?
A Different Perspective
Overpaying can erode returns.
![“[In picking stocks] You really have to know a lot about business. You have to know a lot about competitive advantage. You have to know a lot about the maintainability of competitive advantage. You have to have a mind that quantifies things in terms of value. And you have to be able to compare…” quote by Charlie Munger](https://sms4smile.com/quotes/img-quotes/496/charlie-munger-458_able_in-picking-stocks-you-really-have-to-kno_2554597.jpg)
![“They [Mc Donalds] take people and give them a first job, which enables them to get a second job. They do a very good job of educating troubled young people to be good citizens and they're probably more successful than charter schools.” quote by Charlie Munger](https://sms4smile.com/quotes/img-quotes/a55/charlie-munger-458_be-good_they-mc-donalds-take-people-and-give-the_41809.jpg)
![“It is way less certain to be a wonderful business in the future. The threat is alternative mediums of information. Every newspaper is scrambling to parlay their existing advantage into dominance on the Internet. But it is way less sure [that this will occur] than the certainty 20 years ago that…” quote by Charlie Munger](https://sms4smile.com/quotes/img-quotes/8d0/charlie-munger-458_advantage_it-is-way-less-certain-to-be-a-wonderful_59627.jpg)
![“Next came the Patent laws. These began in England in 1624; and, in this country, with the adoption of our constitution. Before then [these?], any man might instantly use what another had invented; so that the inventor had no special advantage from his own invention. The patent system changed this…” quote by Abraham Lincoln](https://sms4smile.com/quotes/img-quotes/449/abraham-lincoln-88_adoption_next-came-the-patent-laws-these-began-in_1828.jpg)
