Chapter 11Building the Portfolio

The signal is the truth. The noise is what distracts us from the truth.

– Nate Silver

We cannot solve our problems with the same level of thinking that created them.

– Albert Einstein

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.

– Warren Buffett

Congrats! After working your way through the preceding chapters and building your set of answers to the 12 questions we shared with you in Chapter 10, you've successfully assembled your target investment portfolio. It's not easy, and odds are, it took more work and time than you thought it would. Let's remember, however, that if it was easy, then everyone would do it, and we all know that simply isn't the case.

While you let out a sigh of relief, we're reminded of what former Intel CEO Andy Grove once said, “Only the paranoid survive.” Now we admit that's a bit harsh, but the gist of what Grove was getting at is now you need to be on guard for mishaps, shortfalls, and other things that can derail the reasons why you added a company's stock to your holdings in the first place.

This gets us back to one of the key points we made early on in our conversations with Bob, Sophia, Reilly, and Tyler—investing is not a snapshot in time. It's not cooking in a crockpot that you can “fix and forget” for a prolonged period of time. ...

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