Mark Moss explains why patience beats activity in investing. Warren Buffett's idea: knowing you'll make only 20 career-defining moves lets you wait for the right ones. Charlie Munger said most wealth comes from waiting, not trading. Concentrate on a few high-leverage actions instead of constant buying and selling.
How does this all make us a better investor? Well, it makes us a better investor from a couple of ways. First of all, I think often about what Warren Buffett said. And he talked about how if a brand new investor that first came into Wall Street or whatever, if he was told that he was only going to have 20 moves his entire career, he'd be able to outperform everybody. That's because you would just sit back and you'd wait for the right 20 moves. The problem is when you're doing too much. Typically, we want to do less but higher value things. Charlie Munger, his partner, said that the big money's not made in the buying and selling. The big money is made in the waiting. And so we want high-value, high-leverage things, but not high activity. And so when we can focus our time, energy, and attention— we're talking about attention— into the couple of moves that I should be doing, we're going to outperform everybody. That's the key.
