Warren Buffet and Charlie Munger on Knowing Your Limitations

Warren Buffet says:

[...] You have to stick within what I call your circle of competence. You have to know what you understand and what you don't understand. It's not terribly important how big the circle is. But it's terribly important that you know where the perimeter is.

Charles Munger adds:

[...] We'd rather deal with what we understand. Why should we want to playa competitive game in a field where we have no advantage - maybe a disadvantage - instead of playing in a field where we have a clear advantage?
Each of you will have to figure out where your talents lie. And you'll have to use your advantages. But if you try to succeed in what you're worst at, you're going to have a very louse career. I can almost guarantee it. To do otherwise, you'd have to buy a winning lottery ticket or get very lucky somewhere else.

Excerpt from Seeking Wisdom: From Darwin to Munger by Peter Bevelin

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