You get paid to do what other are unable to do

As an investor or for that matter in any situation generally you always get paid more to do what others won’t do. For instance, Michael Jordan got paid because he could play basketball in a way others were not.

Why might they not be doing what you are doing and getting paid more for? It could be because of lack of ability (intelligence, skill). It could be lack of resources (money, time). It could be an institutional constraint (scalability, career risk). It could be an agency problem. It could be for emotional or psychological reasons. It could be because they just don’t want to.

The trick in any situation is to find that area where you are able to take advantage of you ability to do something others can’t do and where you know your going to get paid more for it. Its even better if you suspect that they will never be able to do what you do and therefore the competition will always be limited.

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