Being wrong Quote by Seth Klarman
“Value investing is predicated on the efficient market hypothesis being wrong.”
About This Quote
Value investing assumes markets are not always efficient, contrary to the efficient market hypothesis.
In simple terms: Markets can be mispriced; value investors profit.
Key Takeaway
Seek undervalued assets.
Themes
investment
efficiency
valuation
Mood
analytical
strategic
Type
theory
practice
When to use this quote
- stock selection
- portfolio construction
- risk assessment
- long‑term holding
Key Concepts
behavioral finance
market anomalies
Questions to Reflect On
- What indicators reveal true mispricing?
- How do you manage risk in inefficient markets?
A Different Perspective
Markets may correct quickly, reducing value gaps.
![“[W]e think the very term 'value investing' is redundant. What is 'investing' if it is not the act of seeking value at least sufficient to justify the amount paid? Consciously paying more for a stock than its calculated value -- in the hope that it can soon be sold for a still-higher price…” quote by Warren Buffett](https://sms4smile.com/quotes/img-quotes/62b/warren-buffett-183_amount_w-e-think-the-very-term-value-investing_1594487.jpg)
