Quotes from Mohnish Pabrai

I think a lot of people are getting more serious about how to do the most good, but there is no road map. I'm hoping I can offer an example.

There is no such thing as a value trap. There are investing mistakes.

I think investors ought to focus on making sure that the stock is within their circle of competence, that it's worth a lot more than it's valued at - and once you have those two things, a stop-loss makes no sense.

The essence of a good investment manager is one who studies a given business and extrapolates the future cash flows that the business is likely to generate over the next several years. Based on the cash flow and asset assessment, they can then arrive at their expected rate of return if they bought a fraction of that business at a given price.

The only way one should buy stocks is if you understand the underlying business. You stay within the circle of competence. You buy businesses you understand.

People see poverty all around them in India, but they are desensitized or immune to it. I came to the conclusion that poverty is driven by lack of education.

One of the reasons why we can make a lot of money in equity markets is because they're auction-driven, and auction-driven markets are very different from almost any other kind of market.

The key to investing is not assessing how much an industry is going to affect society, or how much it will grow, but rather determining the competitive advantage of any given company and, above all, the durability of that advantage.4 —Warren Buffett

Einstein also recognized the power of simplicity, and it was the key to his breakthroughs in physics. He noted that the five ascending levels of intellect were, "Smart, Intelligent, Brilliant, Genius, Simple." For Einstein, simplicity was simply the highest level of intellect.

Heads, I win; tails, I don't lose much.

He bought an existing business with a well-defined business model and one with a long history of operations that he could analyze. This is waaaaaaaay less risky than doing a startup.

Capitalism is greed driven.