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“I think markets will never be efficient because of human nature.” quote by Seth Klarman
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“I think markets will never be efficient because of human nature.”

Seth Klarman

About This Quote

Source Book: Investment Strategies, 2013

Human behavior prevents markets from ever being perfectly efficient.

In simple terms: Human nature hinders market efficiency.

Key Takeaway

Account for irrationality.

Themes

finance behavior market theory

Mood

analytical cautious

Type

theoretical practical

When to use this quote

  • trading
  • portfolio management
  • policy making

Key Concepts

behavioral economics information asymmetry risk perception

Questions to Reflect On

  • How do emotions affect pricing?
  • Can markets ever be truly efficient?
A Different Perspective

Efficient market hypothesis still useful in models.

2.5 out of 5 (10 ratings)

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