The best businesses we've found are ones where the value of the business actually increases the longer you hold it, not just because of retained earnings, but because the competitive position strengthens over time. That's the opposite of what most people think about when they think about an investment decaying or having a terminal value that you have to discount back.
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Consumers, conditioned by heavy promotion and by habit, did not bolt even as prices of some of their favorite soaps and cereals increased by 5% or 8% a year. And so profits increased much faster than that. Heinz's earnings climbed by an average of 13% a year during the past decade, Clorox's by 15%.
Gretchen Morgensen
What's being penalised is diversification itself. Punishment awaits any portfolio that doesn't look like the index, says UBS. Clever stock picking won't deliver outperformance like it once did, not just because it's hard, but because it means allocating cash away from the dominant eight.
FT Alphaville
The trick is to keep learning. If you stop learning, other people will pass you by. Temperament alone won't do it — you have to keep learning, because the world keeps changing, and you have to keep up with it and even get ahead of it.
Charlie Munger — USC Law School Commencement Address