Limit risk with: Deep analysis Bargain purchase Sensitivity analysis. — Seth Klarman Copy Share Image
Don't short many stocks. Instead they hedge for tail risk with CDS and options. They are happy to incur illiquidity — Seth Klarman Copy Share Image
Targeting investment returns leads investors to focus on potential upside rather on downside risk ... rather than targeting a desired rate of… — Seth Klarman Copy Share Image
When all feels calm and prices surge, the markets may feel safe; but, in fact, they are dangerous because few investors are… — Seth Klarman Copy Share Image
Do not trust financial market risk models. Despite the predilection of some analysts to model the financial markets using sophisticated mathematics, the… — Seth Klarman Copy Share Image
While it might seem that anyone can be a value investor, the essential characteristics of this type of investor-patience, discipline, and risk… — Seth Klarman Copy Share Image
We continue to adhere to a common-sense view of risk - how much we can lose and the probability of losing it.… — Seth Klarman Copy Share Image
We are not so brazen as to believe that we can perfectly calibrate valuation; determining risk and return for any investment remains… — Seth Klarman Copy Share Image
Investors should always keep in mind that the most important metric is not the returns achieved but the returns weighed against the… — Seth Klarman Copy Share Image
In contrast to the speculators preoccupation with rapid gain, value investors demonstrate their risk aversion by striving to avoid loss. — Seth Klarman Copy Share Image
Investors frequently benefit from making decisions with less than perfect knowledge and are well rewarded for bearing the risk of uncertainty. The… — Seth Klarman Copy Share Image
The risk of an investment is described by both the probability and the potential amount of loss. The risk of an investment-the… — Seth Klarman Copy Share Image
Do not accept principal risk while investing short-term cash: the greedy effort to earn a few extra basis points of yield inevitably… — Seth Klarman Copy Share Image
Nowhere does it say that investors should strive to make every last dollar of potential profit; consideration of risk must never take… — Seth Klarman Copy Share Image
Risk is not inherent in an investment; it is always relative to the price paid. Uncertainty is not the same as risk.… — Seth Klarman Copy Share Image
While some might mistakenly consider value investing a mechanical tool for identifying bargains, it is actually a comprehensive investment philosophy that emphasizes… — Seth Klarman Copy Share Image
As value investors, our business is to buy bargains that financial market theory says do not exist. We've delivered great returns to… — Seth Klarman Copy Share Image
In the financial markets, however, the connection between a marketable security and the underlying business is not as clear-cut. For investors in… — Seth Klarman Copy Share Image
Most investors are primarily oriented toward return, how much they can make and pay little attention to risk, how much they can… — Seth Klarman Copy Share Image
Right at the core, the mainstream has it backwards. Warren Buffett often quips that the first rule of investing is to not… — Seth Klarman Copy Share Image
There are only a few things investors can do to counteract risk: diversify adequately, hedge when appropriate, and invest with a margin… — Seth Klarman Copy Share Image
Warren Buffett likes to say that the first rule of investing is "Don't lose money," and the second rule is, "Never forget… — Seth Klarman Copy Share Image
Pressure to produce over the short term - a gun to the head of everyone - encourages excessive risk taking which manifests… — Seth Klarman Copy Share Image
It's awful to have a depression, but it's a great thing to have a depression mentality because it means that we are… — Seth Klarman Copy Share Image
Below, we itemize some of the quite different lessons investors seem to have learned as of late 2009 - false lessons, we… — Seth Klarman Copy Share Image
Rather, risk is a perception in each investor's mind that results from analysis of the probability and amount of potential loss from… — Seth Klarman Copy Share Image
The government - the ultimate short-term-oriented player - cannot withstand much pain in the economy or the financial markets. Bailouts and rescues… — Seth Klarman Copy Share Image
My view is that an investor is better off knowing a lot about a few investments than knowing a little about each… — Seth Klarman Copy Share Image
Unlike return, however, risk is no more quantifiable at the end of an investment that it was at its beginning. Risk simply… — Seth Klarman Copy Share Image
Unlike return, however, risk is no more quantifiable at the end of an investment that it was at its beginning. Risk simply cannot be… — Seth Klarman Copy Share
Because investors are not usually penalized for adhering to conventional practices, doing so is the less professionally risky strategy, even though it virtually guarantees… — Seth Klarman Copy Share
There is an old saying, "How did you go bankrupt?" And the answer is, "Gradually, and then suddenly." The impending fiscal crisis in the… — Seth Klarman Copy Share
In a rising market, everyone makes money and a value philosophy is unnecessary. But because there is no certain way to predict what the… — Seth Klarman Copy Share
Ultimately, nothing should be more important to investors than the ability to sleep soundly at night. — Seth Klarman Copy Share
Warren Buffett once wrote that value investing is like an inoculation--it either takes or it doesn't--and when you explain to somebody what it is… — Seth Klarman Copy Share
It is important to remember that value investing is not a perfect science. It is an, with an ongoing need for judgment, refinement, patience,… — Seth Klarman Copy Share
Value investing is at its core the marriage of a contrarian streak and a calculator. — Seth Klarman Copy Share
Ratings agencies are highly conflicted, unimaginative dupes. They are blissfully unaware of adverse selection and moral hazard. Investors should never trust them. — Seth Klarman Copy Share
It is crucial to have a strategy in place before problems hit, precisely because no one can accurately predict the future direction of the… — Seth Klarman Copy Share
