About this episode

Mohnish Pabrai discusses various mental models for exceptional capital allocation.

Mental Models for Exceptional Capital Allocation by Mohnish Pabrai at The University of Nebraska, Omaha on May 1, 2026. (00:00:00) - Introduction (00:02:11) - Charlie Munger's mental models (00:03:43) - Model 1: The Bedrock: Take a simple idea and take it seriously (00:04:06) - Model 2: Ben Graham's Fundamentals (00:04:59) - Model 3: Do not overdose on Ben Graham; Poor Charlie's Almanack, Philip Fisher, and Pulak Prasad (00:05:16) - Model 4: Buffett's lifetime 20-punch card (00:06:05) - Model 5: Stay in the epicentre of your circle of competence; John Arrillaga (00:07:52) - Model 6: A high error rate is guaranteed in investing (00:08:06) - Model 7: Circle the wagons: the 4% rule (00:08:44) - Berkshire's 12 best decisions in 60 years (00:09:41) - Mistakes in investing: Ferrari, Progressive Insurance & Goldman Sachs (00:12:10) - Model 8: Do not cut flowers and water weeds (00:13:02) - Model 9: Be a shameless cloner; VIC; Dataroma & SumZero (00:15:11) - Model 10: History does not repeat itself - but it does rhyme (00:16:16) - Model 11: Explain your investment thesis to a 10-year old in 3-4 sentences (00:16:41) - Model 12: You always need a rope to get out of the deepest well…

People in this episode

Host: Mohnish Pabrai

Topics covered

• capital allocation
• mental models
• investing strategies
• decision making
• investment mistakes

Keywords

• capital allocation
• mental models
• investing
• investment strategies
• decision making

Mentioned in this episode

Organizations: Berkshire, Ferrari, Progressive Insurance, Goldman Sachs

Books & works: Poor Charlie's Almanack, Zen and the Art of Motorcycle Maintenance

Places: University of Nebraska, Omaha

More episodes of Chai with Pabrai

• Mohnish Pabrai's Interview with Knowledge Inside podcast on June 8, 2026 · July 1, 2026 · 55 min
• Mohnish Pabrai's Interview with My First Million on May 5, 2026 · June 25, 2026 · 1h 30m
• Mohnish Pabrai's Interview with The Investor's Podcast on March 23, 2026 · June 5, 2026 · 51 min
• Q&A session with Dakshana scholars at JNV Bangalore Urban on December 25, 2025 · June 2, 2026 · 1h 6m
• Mental Models by Mohnish Pabrai at Heilbrunn Center for Graham and Dodd Investing on April 21, 2026 · June 1, 2026 · 52 min
• Mental Models for Running Startups and Businesses, SXSW 2026 on March 16, 2026 · April 23, 2026 · 46 min

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