Quote

Black-Scholes works for short-term options, but if it's a long-term option and you think you know something [about the underlying asset], it's insane to use Black-Scholes.

Charlie Munger

Change background

T
T
T

Change font

TAGS & TOPICS

Charlie Munger
Age: 100
Born: 1924
Born: January 1
Business Person
Financier
Investor
Lawyer
Omaha
Nebraska
Charlie Thomas Munger
Charles T. Munger
Charles Thomas Munger
Thinking
Short
Works
Term
Underlying
Use
Asset
Black
Options
Long
Option
Something
Assets
Think
Insane

More quotes by Charlie Munger

Image
To atone, I teach and try to set an example... I love spreading this stuff around. Just because it's trite doesn't mean it isn't right. In fact, I like to say, 'If it's trite, it's right.'
Charlie Munger
Image
Trying to prioritize among things we're unlikely to do is pretty fruitless.
Charlie Munger
Image
We’re partial to putting out large amounts of money where we won’t have to make another decision.
Charlie Munger
Image
The beauty of a financial institution is that there are a lot of ways to go to hell in a bucket. You can push credit too far, do a dumb acquisition, leverage yourself excessively - it's not just derivatives [that can bring about your downfall].
Charlie Munger
Image
Since those don’t hit financial reports, the opportunities you had but didn’t accept, most people don’t bother thinking about them very much. At least that is a mistake we don’t make. We rub our own noses in our mistakes in blowing opportunities, as we just did.
Charlie Munger
Image
There is the sheer amount of Franklin's wisdom. And the talent. Franklin played four instruments. He was the nation's leading scientist and inventor, plus a leading author, statesman, and philanthropist. There has never been anyone like him.
Charlie Munger
Image
Is there such thing as a cheerful pessimist? That's what I am.
Charlie Munger
Image
Almost all good businesses engage in 'pain today, gain tomorrow' activities.
Charlie Munger
Image
Cicero's words also increased my personal satisfaction by supporting my long-standing rejection of a conventional point of view.
Charlie Munger
Image
I think the idea that the hedge fund manager gets lower taxes than the taxi driver or the physics professor is insane. The legislators who leave that policy in place are derelict in their duties to be rational and fair. There are plenty of them in both political parties. It's totally outrageous.
Charlie Munger
Image
All intelligent investing is value investing - acquiring more that you are paying for. You must value the business in order to value the stock.
Charlie Munger
Image
If you get into the mental habit of relating what you're reading to the basic structure of the underlying ideas being demonstrated, you gradually accumulate some wisdom.
Charlie Munger
Image
Our biggest mistakes, were things we didn't do, companies we didn't buy.
Charlie Munger
Image
Warren spends 70 hours a week thinking about investing .
Charlie Munger
Image
You don't have to be brilliant, only a little bit wiser than the other guys, on average, for a long, long, time.
Charlie Munger
Image
A lot of our respected financial institutions are just casinos in drag.
Charlie Munger
Image
Expect hogs to eat a lot more in the presence of a lot of hog wash.
Charlie Munger
Image
Once you start doing something bad, then it's easy to take the next step - and in the end, you're a moral sewer.
Charlie Munger
Image
The liabilities are always 100 percent good. It's the assets you have to worry about.
Charlie Munger
Image
The more hard lessons you can learn vicariously rather than through your own hard experience, the better.
Charlie Munger