"Buy good companies, don't overpay, do nothing."

Terry Smith distilled his entire investment philosophy into seven words — and then spent two decades proving it works. Fundsmith Equity has compounded at roughly 15% annualized since 2010 by owning ~25 high-ROIC businesses and barely trading. Annual portfolio turnover has averaged under 5%.

The "do nothing" part is the hardest. It means watching a holding drop 25% and not selling. It means watching a non-holding double and not chasing. It means accepting that most quarters, the optimal action is no action at all. The compounding does the work — if you let it.