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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

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Seth Klarman
Age: 67
Born: 1957
Born: May 21
New York City
New York
Seth Andrew Klarman
Sleep
Returns
Ability
Investors
Keep
Risks
Night
Achieved
Incurred
Nothing
Investing
Soundly
Important
Ultimately
Metric
Mind
Return
Metrics
Always
Risk
Weighed

More quotes by Seth Klarman

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As Buffett has often observed, value investing is not a concept that can be learned and gradually applied over time. It is either absorbed and adopted at once, or it is never truly learned.
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When all feels calm and prices surge, the markets may feel safe but, in fact, they are dangerous because few investors are focusing on risk.
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In a rising market, everyone makes money and a value philosophy is unnecessary. But because there is no certain way to predict what the market will do, one must follow a value philosophy at all times.
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Be indifferent if you lose your short term clients, remember they are your own worst enemy
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Typically, we make money when we buy things. We count the profits later, but we know we have captured them when we buy the bargain.
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There is no amount of bad news that the markets cannot see past.
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Almost every financial blow up is because of leverage.
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Once you adopt a value-investment strategy, any other investment behavior starts to seem like gambling.
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The cost of performing well in bad times can be relative underperformance in good times.
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Interestingly, we have beaten the market quite handsomely over this time frame, although beating the market has never been our objective. Rather, we have consistently tried not to lose money and, in doing so, have not only protected on the downside but also outperformed on the upside.
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At Baupost, we constantly ask: 'What should we work on today?' We keep calling and talking. We keep gathering information. You never have perfect information. So you work, work and work. Sometimes we thumb through ValuLine. How you fill your inbox is very important.
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It is crucial in a sound investment process to search a mile wide than a mile deep with they find something - also.. never stop digging for information.
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The near absence of bargains works as a reverse indicator for us. When we find there is little worth buying, there is probably much worth selling.
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In contrast to the speculators preoccupation with rapid gain, value investors demonstrate their risk aversion by striving to avoid loss.
Seth Klarman
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Value investing is risk aversion.
Seth Klarman
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It sounds kind of crazy, but in times of turmoil in the market, I've felt a sort of serenity in knowing that I've checked and re-checked my work, one plus one still equals two regardless of where a stock trades right after I buy it.
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As Graham, Dodd and Buffett have all said, you should always remember that you don't have to swing at every pitch. You can wait for opportunities that fit your criteria and if you don't find them, patiently wait. Deciding not to panic is still a decision.
Seth Klarman
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The government can indefinitely control both short-term and long-term interest rates.
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I think Buffett is a better investor than me because he has a better eye toward what makes a great business. And when I find a great business I'm happy to buy it and hold it. Most businesses don't look so great to me.
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A tipping point is invisible, as we just saw in Greece. In most situations, everything appears fine until it's not fine, until, for example, no one shows up at a Treasury auction.
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