--- title: "Meaning & Key Takeaway of: Investors should always keep in mind that…" description: "\"Investors should always keep in mind that the most important metric is not the returns achieved but the returns weighed against the risks incurred. Ult..." image: "https://sms4smile.com/quotes/i/2bf/seth-klarman-1979_ability_investors-should-always-keep-in-mind-tha_2409263.png" --- # Investors should always keep in mind that the most… ![“Investors should always keep in mind that the most important metric is not the returns achieved but the returns weighed against the risks incurred. Ultimately, nothing should be more important to investors than the ability to sleep soundly at night.” quote by Seth Klarman](https://sms4smile.com/quotes/i/2bf/seth-klarman-1979_ability_investors-should-always-keep-in-mind-tha_2409263.png) [Download](https://sms4smile.com/quotes/i/2bf/seth-klarman-1979_ability_investors-should-always-keep-in-mind-tha_2409263.png) [Open image](https://sms4smile.com/quotes/i/2bf/seth-klarman-1979_ability_investors-should-always-keep-in-mind-tha_2409263.png) > “Investors should always keep in mind that the most important metric is not the returns achieved but the returns weighed against the risks incurred. Ultimately, nothing should be more important to investors than the ability to sleep soundly at night.” [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) ## About This Quote This interpretation was drafted with AI assistance. It is one reading of the quote, not the author's own explanation. Investors should prioritize risk-adjusted returns and peace of mind over chasing high gains, valuing safety and sleep over profit. **In simple terms:** Sleep well by focusing on risk, not just returns. Key Takeaway Prioritize risk management for peace. Themes investment risk management peace of mind Mood cautious analytical Type advisory financial When to use this quote - portfolio construction - retirement planning - stress reduction - risk assessment Key Concepts risk-adjusted return financial safety Questions to Reflect On - How do you balance risk and reward? - What gives you confidence to sleep at night? A Different Perspective Risk focus can limit upside potential. ★ ★ ★ ★ ★ No ratings yet [Ability](https://sms4smile.com/quotes/about/ability/) [Customer](https://sms4smile.com/quotes/about/customer/) [Important](https://sms4smile.com/quotes/about/important/) [Important Investors](https://sms4smile.com/quotes/about/important-investors-425097/) [Investing](https://sms4smile.com/quotes/about/investing/) [Investors](https://sms4smile.com/quotes/about/investors/) [Investors Ability](https://sms4smile.com/quotes/about/investors-ability-1863105/) [Investors Mind](https://sms4smile.com/quotes/about/investors-mind-5040294/) [Metrics](https://sms4smile.com/quotes/about/metrics/) [Mind](https://sms4smile.com/quotes/about/mind/) [Night](https://sms4smile.com/quotes/about/night/) [Psychology](https://sms4smile.com/quotes/about/psychology/) [Return](https://sms4smile.com/quotes/about/return/) [Returns Weighed](https://sms4smile.com/quotes/about/returns-weighed-6059544/) [Risk](https://sms4smile.com/quotes/about/risk/) [Should](https://sms4smile.com/quotes/about/should/) [Sleep](https://sms4smile.com/quotes/about/sleep/) ## Related quotes > [Ultimately, nothing should be more important to investors than the ability to sleep soundly at night.](https://sms4smile.com/quotes/seth-klarman/ultimately-nothing-should-be-more-important-to-investors-than-the/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [It is important for investors to understand what they do and don't know. 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It is critical to know why you have…](https://sms4smile.com/quotes/seth-klarman/investors-should-pay-attention-not-only-to-whether-but-also-to-why/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [My view is that an investor is better off knowing a lot about a few investments than knowing a little about each of a…](https://sms4smile.com/quotes/seth-klarman/my-view-is-that-an-investor-is-better-off-knowing-a-lot-about-a-few/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [Individual and institutional investors alike frequently demonstrate an inability to make long-term investment decisions based on business fundamentals.](https://sms4smile.com/quotes/seth-klarman/individual-and-institutional-investors-alike-frequently-demonstrate/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [Ratings agencies are highly conflicted, unimaginative dupes. They are blissfully unaware of adverse selection and moral hazard. Investors should never trust them.](https://sms4smile.com/quotes/seth-klarman/ratings-agencies-are-highly-conflicted-unimaginative-dupes-they-are/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [Because investors are not usually penalized for adhering to conventional practices, doing so is the less professionally risky strategy, even though it virtually guarantees…](https://sms4smile.com/quotes/seth-klarman/because-investors-are-not-usually-penalized-for-adhering-to/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) ## More by Seth Klarman > [Unlike return, however, risk is no more quantifiable at the end of an investment that it was at its beginning. Risk simply cannot be…](https://sms4smile.com/quotes/seth-klarman/unlike-return-however-risk-is-no-more-quantifiable-at-the-end-of-an/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [Because investors are not usually penalized for adhering to conventional practices, doing so is the less professionally risky strategy, even though it virtually guarantees…](https://sms4smile.com/quotes/seth-klarman/because-investors-are-not-usually-penalized-for-adhering-to/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [Value investing is risk aversion.](https://sms4smile.com/quotes/seth-klarman/value-investing-is-risk-aversion/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [Be focused on process and not outcome](https://sms4smile.com/quotes/seth-klarman/be-focused-on-process-and-not-outcome/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [There is an old saying, "How did you go bankrupt?" And the answer is, "Gradually, and then suddenly." The impending fiscal crisis in the…](https://sms4smile.com/quotes/seth-klarman/there-is-an-old-saying-how-did-you-go-bankrupt-and-the-answer-is/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [In a rising market, everyone makes money and a value philosophy is unnecessary. 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It is an, with an ongoing need for judgment, refinement, patience,…](https://sms4smile.com/quotes/seth-klarman/it-is-important-to-remember-that-value-investing-is-not-a-perfect/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [Value investing is at its core the marriage of a contrarian streak and a calculator.](https://sms4smile.com/quotes/seth-klarman/value-investing-is-at-its-core-the-marriage-of-a-contrarian-streak/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [The avoidance of loss is the surest way to ensure a profitable outcome.](https://sms4smile.com/quotes/seth-klarman/the-avoidance-of-loss-is-the-surest-way-to-ensure-a-profitable-outcome/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [Do not suffer interim losses, relish and appreciate them](https://sms4smile.com/quotes/seth-klarman/do-not-suffer-interim-losses-relish-and-appreciate-them/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [Ratings agencies are highly conflicted, unimaginative dupes. They are blissfully unaware of adverse selection and moral hazard. Investors should never trust them.](https://sms4smile.com/quotes/seth-klarman/ratings-agencies-are-highly-conflicted-unimaginative-dupes-they-are/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [It is crucial to have a strategy in place before problems hit, precisely because no one can accurately predict the future direction of the…](https://sms4smile.com/quotes/seth-klarman/it-is-crucial-to-have-a-strategy-in-place-before-problems-hit/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) [Explore all 193 Seth Klarman quotes ](https://sms4smile.com/quotes/author/seth-klarman/) ## More Ability quotes > [I don't think there's a direct correlation between my sexuality and my skiing ability. But I think because I was so concerned about it…](https://sms4smile.com/quotes/gus-kenworthy/i-don-t-think-there-s-a-direct-correlation-between-my-sexuality-and/) [Gus Kenworthy](https://sms4smile.com/quotes/author/gus-kenworthy/) > [“the importance of ability. The things that make a great job great, I discovered, are rare and valuable. 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Holland](https://sms4smile.com/quotes/author/jeffrey-r-holland/) > [Maybe law enforcement would like the ability to turn on the camera on your Mac.](https://sms4smile.com/quotes/tim-cook/maybe-law-enforcement-would-like-the-ability-to-turn-on-the-camera-on/) [Tim Cook](https://sms4smile.com/quotes/author/tim-cook/) > [I've seen guys come along with more ability - they've been faster or bigger or stronger - but they never worked hard to develop…](https://sms4smile.com/quotes/steve-largent/i-ve-seen-guys-come-along-with-more-ability-they-ve-been-faster-or/) [Steve Largent](https://sms4smile.com/quotes/author/steve-largent/) > [The youth of India has the strength to move the entire World with a click of a mouse, we have generated that ability!](https://sms4smile.com/quotes/narendra-modi/the-youth-of-india-has-the-strength-to-move-the-entire-world-with-a/) [Narendra Modi](https://sms4smile.com/quotes/author/narendra-modi/) > [Time hath not yet so dried this blood of mine, Nor age so eat up my invention, Nor fortune made such havoc of my…](https://sms4smile.com/quotes/william-shakespeare/time-hath-not-yet-so-dried-this-blood-of-mine-nor-age-so-eat-up-my/) [William Shakespeare](https://sms4smile.com/quotes/author/william-shakespeare/) > [An absolutely necessary part of a writer's equipment, almost as necessary as talent, is the ability to stand up under punishment, both the punishment…](https://sms4smile.com/quotes/irwin-shaw/an-absolutely-necessary-part-of-a-writer-s-equipment-almost-as/) [Irwin Shaw](https://sms4smile.com/quotes/author/irwin-shaw/) > [I'd be more frightened by not using whatever abilities I'd been given. I'd be more frightened by procrastination and laziness.](https://sms4smile.com/quotes/denzel-washington/i-d-be-more-frightened-by-not-using-whatever-abilities-i-d-been-given/) [Denzel Washington](https://sms4smile.com/quotes/author/denzel-washington/) > [Bring into captivity every thought to the obedience of Christ. 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