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Charlie Munger’s 5 Investing Mistakes to Avoid

Munger once said, “If people weren’t so often wrong, we wouldn’t be so rich.” His point? Most investors lose money not by bad luck, but by repeating avoidable mistakes.

Here are 5 deadly errors Munger warned against:
1. Emotional investing — Letting fear or greed guide decisions leads to poor outcomes. Stick to logic, not sentiment.
2. Market timing — Trying to predict highs and lows rarely works. The real gains come from patience and long-term holding.
3. Over- or under-diversification — Too little risk spreads you thin. Too much exposure increases vulnerability. Balance is key.
4. Unrealistic expectations — Markets are volatile and unpredictable. Stick to sound businesses and ignore short-term hype.
5. Failing to learn from mistakes — Analyze losses. Accept you’re wrong sometimes. Learn and adjust.

Munger’s legacy? Master your psychology, think long term, and profit where others fail.