Mohnish Pabrai: How To Define Your Circle of Competence

Warren Buffett has often said that investors should only buy stocks that fall inside their circle of competence. That’s easy enough to say, but many investors may find it hard to define their sphere of competence concretely. If you’re looking for value stocks, and exclusive access to value-focused hedge fund managers, check out Hidden Value Stocks. At its core, the circle of competence is all about investing in what you know. Peter Lynch proposed a similar strategy. Lynch believed that our greatest research tools were our eyes, ears and common sense. He found many of his great investment ideas while…