Circle of Competence

Decision MakingSelf-AwarenessInvestment

The Circle of Competence emphasizes focusing decisions and actions within areas of expertise while avoiding areas of ignorance.

Introduction

The Circle of Competence emphasizes focusing decisions and actions within areas of expertise while avoiding areas of ignorance.

Core Principles

  1. Self-Awareness: Understand your strengths and limitations.
  2. Specialization: Develop expertise in specific domains.
  3. Avoid Overreach: Do not venture beyond your understanding.

Applications

  • Investment strategies for assessing industries or companies.
  • Career planning to align roles with skills and interests.

Related Resources

  • Quote: "Stay within your circle of competence." - Warren Buffett.
  • Tools: Self-assessment frameworks.

Related Topics

Mental Models Related

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Methodology Related

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Combined Terms

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Professional Applications

  • business mental models
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