Investing lessons often appear in unlikely places.
In a city park, I began to notice a quiet pattern. Each stray cat stayed within the same small area day after day — the same trees, the same water’s edge, the same escape routes. After being fed, one cat climbed into a tree and moved confidently among familiar branches before vanishing into a hidden resting spot.
The cat wasn’t wandering.
It wasn’t exploring.
It was operating strictly inside what it knew.
That behavior mirrors Charlie Munger’s circle of competence almost perfectly.
Munger’s idea is simple but difficult to practice: you don’t need to understand everything. You only need to know exactly what you understand — and have the discipline to stay within those boundaries. Most serious mistakes happen not from total ignorance, but from stepping just slightly beyond true competence.
The cat’s circle is clear:
- Predictable food sources
- Reliable escape routes
- Familiar resting places
- Known threat patterns
Inside that circle, risk is bounded.
Outside it, outcomes grow uncertain — and sometimes irreversible.
So the cat doesn’t chase every opportunity. Even when a tempting smell drifts beyond its territory, it doesn’t follow. It eats, retreats, and returns to safety.
That isn’t fear.
It’s asymmetric risk management.
Humans chase the opposite. Novelty floods us with dopamine from new destinations, hot sectors, or FOMO-driven trades—pulling us beyond known edges. We mistake confidence for competence, assuming intelligence fills experience gaps.
The cat stays put—and survives.
It doesn’t try to optimize returns.
It doesn’t try to outperform its environment.
It simply avoids irreversible mistakes.
Charlie Munger often said that avoiding stupidity matters more than seeking brilliance. The cat lives this principle instinctively, protecting its edge by staying where its knowledge is deepest.
You don’t win by doing more.
You win by knowing where not to play.
The cat understands its circle — and survives by respecting it.
FlightToWealth invests where understanding compounds.