--- title: "Meaning & Key Takeaway of: To a value investor, investments come in…" description: "\"To a value investor, investments come in three varieties: undervalued at one price, fairly valued at another price, and overvalued at still some higher..." image: "https://sms4smile.com/quotes/i/17c/seth-klarman-1979_customer_to-a-value-investor-investments-come-in_2884996.png" --- # To a value investor, investments come in three varieties… ![“To a value investor, investments come in three varieties: undervalued at one price, fairly valued at another price, and overvalued at still some higher price. The goal is to buy the first, avoid the second, and sell the third.” quote by Seth Klarman](https://sms4smile.com/quotes/i/17c/seth-klarman-1979_customer_to-a-value-investor-investments-come-in_2884996.png) [Download](https://sms4smile.com/quotes/i/17c/seth-klarman-1979_customer_to-a-value-investor-investments-come-in_2884996.png) [Open image](https://sms4smile.com/quotes/i/17c/seth-klarman-1979_customer_to-a-value-investor-investments-come-in_2884996.png) > “To a value investor, investments come in three varieties: undervalued at one price, fairly valued at another price, and overvalued at still some higher price. The goal is to buy the first, avoid the second, and sell the third.” [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 buy undervalued assets, avoid fair‑priced ones, and sell overvalued assets to maximize returns. **In simple terms:** Buy low, avoid average, sell high. Key Takeaway Prioritize value gaps in markets. Themes finance investment valuation Mood analytical pragmatic Type financial educational When to use this quote - stock selection - portfolio rebalancing - asset allocation Key Concepts value investing market cycles risk management Questions to Reflect On - How do you identify true undervaluation? - When should you exit a fair‑valued position? A Different Perspective Market timing is uncertain; valuation is subjective. ★ ★ ★ ★ ★ No ratings yet [Customer](https://sms4smile.com/quotes/about/customer/) [Goal](https://sms4smile.com/quotes/about/goal/) [Investing](https://sms4smile.com/quotes/about/investing/) [Investment](https://sms4smile.com/quotes/about/investment/) [Investors](https://sms4smile.com/quotes/about/investors/) [Values](https://sms4smile.com/quotes/about/values/) [Variety](https://sms4smile.com/quotes/about/variety/) ## Related quotes > [Investors should pay attention not only to whether but also to why current holdings are undervalued. 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/) > [The late 90s almost forced me to identify myself as a value investor, because I thought what everybody else was doing was insane.](https://sms4smile.com/quotes/michael-burry/the-late-90s-almost-forced-me-to-identify-myself-as-a-value-investor/) [Michael Burry](https://sms4smile.com/quotes/author/michael-burry/) > [ To be a value investor, you have to be willing \[and able\] to suffer pain. ](https://sms4smile.com/quotes/jean-marie-eveillard/to-be-a-value-investor-you-have-to-be-willing-and-able-to-suffer-pain/) Jean-Marie Eveillard > [The strategy of buying what's in favor is a fool's errand, ensuring long-term underperformance. Only by standing against the prevailing winds - selectively, but…](https://sms4smile.com/quotes/seth-klarman/the-strategy-of-buying-what-s-in-favor-is-a-fool-s-errand-ensuring/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [Value in relation to price, not price alone, must determine your investment decisions. If you look to Mr Market as a creator of investment…](https://sms4smile.com/quotes/seth-klarman/value-in-relation-to-price-not-price-alone-must-determine-your/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [While it might seem that anyone can be a value investor, the essential characteristics of this type of investor-patience, discipline, and risk aversion-may well…](https://sms4smile.com/quotes/seth-klarman/while-it-might-seem-that-anyone-can-be-a-value-investor-the-essential/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [If you are predisposed to be patient, disciplined and psychologically appreciate the idea of buying bargains, then you're likely to be good at it.…](https://sms4smile.com/quotes/seth-klarman/if-you-are-predisposed-to-be-patient-disciplined-and-psychologically/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [Nirvana, to a value investor, is paying a cheap price for a company that is growing in value every year at a nice rate…](https://sms4smile.com/quotes/whitney-tilson/nirvana-to-a-value-investor-is-paying-a-cheap-price-for-a-company/) [Whitney Tilson](https://sms4smile.com/quotes/author/whitney-tilson/) > [There’s a virtuous cycle when people have to defend challenges to their ideas. Any gaps in thinking or analysis become clear pretty quickly when…](https://sms4smile.com/quotes/joel-greenblatt/there-s-a-virtuous-cycle-when-people-have-to-defend-challenges-to/) [Joel Greenblatt](https://sms4smile.com/quotes/author/joel-greenblatt/) > [We take the traditional value investor's process and just flip it around a little bit. The traditional value investor asks 'Is this cheap?' and…](https://sms4smile.com/quotes/david-einhorn/we-take-the-traditional-value-investor-s-process-and-just-flip-it/) [David Einhorn](https://sms4smile.com/quotes/author/david-einhorn/) > [“statistical overvaluation is a funny thing – it can go on for a very long time, far beyond the limits of rationality, and it…](https://sms4smile.com/quotes/christopher-risso-gill/statistical-overvaluation-is-a-funny-thing-it-can-go-on-for-a-very/) Christopher Risso-gill > [I've learned there's a big difference between a long-focused value investor and a good short-seller. That difference is psychological and I think it falls…](https://sms4smile.com/quotes/james-chanos/i-ve-learned-there-s-a-big-difference-between-a-long-focused-value/) [James Chanos](https://sms4smile.com/quotes/author/james-chanos/) > [“Price mostly meanders around recent price until a big shift in opinion occurs, causing price to jump up or down. This is crudely modeled…](https://sms4smile.com/quotes/nick-gogerty/price-mostly-meanders-around-recent-price-until-a-big-shift-in/) [Nick Gogerty](https://sms4smile.com/quotes/author/nick-gogerty/) > [The single biggest advantage a value investor has is not IQ. It's patience and waiting. Waiting for the right pitch, and waiting for many…](https://sms4smile.com/quotes/mohnish-pabrai/the-single-biggest-advantage-a-value-investor-has-is-not-iq-it-s/) [Mohnish Pabrai](https://sms4smile.com/quotes/author/mohnish-pabrai/) > [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. But because there is no certain way to predict what the…](https://sms4smile.com/quotes/seth-klarman/in-a-rising-market-everyone-makes-money-and-a-value-philosophy-is/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [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/) > [The best protection against risk is knowing what you are doing.](https://sms4smile.com/quotes/seth-klarman/the-best-protection-against-risk-is-knowing-what-you-are-doing/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [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…](https://sms4smile.com/quotes/seth-klarman/warren-buffett-once-wrote-that-value-investing-is-like-an-inoculation/) [Seth Klarman](https://sms4smile.com/quotes/author/seth-klarman/) > [It is important to remember that value investing is not a perfect science. 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 Customer quotes > [“Start a business, not a startup”](https://sms4smile.com/quotes/anonymous/start-a-business-not-a-startup/) [Anonymous](https://sms4smile.com/quotes/author/anonymous/) > [Amongst the financial Twitterati, the term 'muppets' has come to describe any client used and abused by some financial predator. 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Think AS the market.](https://sms4smile.com/quotes/michael-fishman/don-t-think-of-the-market-think-as-the-market/) Michael Fishman > [If Wall Street crashes, does Main Street follow? Not necessarily.](https://sms4smile.com/quotes/ben-bernanke/if-wall-street-crashes-does-main-street-follow-not-necessarily/) [Ben Bernanke](https://sms4smile.com/quotes/author/ben-bernanke/) > [The exact details of how you practice value investing will vary investor to investor, but the fundamental principle of scouring the world, looking for…](https://sms4smile.com/quotes/whitney-tilson/the-exact-details-of-how-you-practice-value-investing-will-vary/) [Whitney Tilson](https://sms4smile.com/quotes/author/whitney-tilson/) > [The best way to hold customers is to constantly figure out how to give them more for less.](https://sms4smile.com/quotes/philip-kotler/the-best-way-to-hold-customers-is-to-constantly-figure-out-how-to/) [Philip Kotler](https://sms4smile.com/quotes/author/philip-kotler/) > [Perhaps the most important reason to be skeptical of government inflation numbers is that the government, like a fox campaigning to guard a hen…](https://sms4smile.com/quotes/peter-schiff/perhaps-the-most-important-reason-to-be-skeptical-of-government/) [Peter Schiff](https://sms4smile.com/quotes/author/peter-schiff/) > [When the dollar collapses, it's not doing it in a vacuum. 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