The wisdom of missing opportunities

In a decades-old video that recently surfaced on social media, a young audience member asks Warren Buffett about his worst investment. Buffett's response is characteristically candid: his biggest mistakes weren't the investments that went wrong, but the opportunities he missed entirely. He estimates missing out on perhaps ten billion dollars in profits from investments he "knew enough to do" but didn't make. The natural reaction to this confession might be alarm. If the world's greatest investor regularly suffers from what he calls "mistakes of omission," surely the rest of us should work overtime to ensure we don't miss any opportunities? This thinking would be precisely wrong. Suggested read: Concentration isn’t for everyone Buffett's admission should actually be deeply reassuring to ordinary investors. Here's a man who has compounded wealth at extraordinary rates for over six decades, yet he freely acknowledges missing enormous opportunities. The crucial insight isn't that we should try harder to catch every wave, but that missing opportunities is an inevitable part of successful investing. Consider what Buffett and his late partner, Charlie Munger, actually did when they encountered investments they didn't fully understand. For decades, they avoided technology stocks entirely. The