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We continue to adhere to a common-sense view of risk - how much we can lose and the probability of losing it. While this perspective may seem over simplisticor even hopelessly outdated, we believe it provides a vital clarity about the true risks in investing.

Seth Klarman

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Seth Klarman
Age: 67
Born: 1957
Born: May 21
New York City
New York
Seth Andrew Klarman
Common
Perspective
Outdated
Sense
Losing
Probability
True
View
Provides
Seems
Seem
Risks
May
Lose
Vital
Even
Risk
Clarity
Much
Views
Investing
Adhere
Believe
Loses
Continue
Hopelessly

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Never stop reading. History doesn't repeat, but it does rhyme.
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When a Wall Street analyst or broker expresses optimism, investors must take it with a grain of salt.
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Gold is unique because it has the age-old aspect of being viewed as a store of value. Nevertheless, it’s still a commodity and has no tangible value, and so I would say that gold is a speculation. But because of my fear about the potential debasing of paper money and about paper money not being a store of value, I want some exposure to gold.
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All an investor can do is follow a consistently disciplined and rigorous approach over time the returns will come
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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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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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Excess capacity in people, machines, or property will be quickly absorbed.
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Analysts recommendations may not produce good results. In part this is due to the pressure placed on these analysts to recommend frequently rather than wisely.
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To achieve long-term success over many financial market and economic cycles, observing a few rules is not enough. Too many things change too quickly in the investment world for that approach to succeed. It is necessary instead to understand the rationale behind the rules in order to appreciate why they work when they do and don't when they don't.
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Avoiding where others go wrong is an important step in achieving investment success. In fact, it almost assures 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.
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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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There are no long-term lessons - ever.
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At equal returns, public investments are generally superior to private investments not only because they are more liquid but also because amidst distress, public markets are more likely than private ones to offer attractive opportunities to average down.
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We don't deal in absolutes. We deal in probabilities.
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It's awful to have a depression, but it's a great thing to have a depression mentality because it means that we are not speculating, we are not living beyond our means, we don't quit our job to take a big risk because we know we might not get another job. There is something stable about a country, a society built on those values.
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My view is that an investor is better off knowing a lot about a few investments than knowing a little about each of a great many holdings. One's very best idea's are likely to generate higher returns for a given level of risk than one's hundredth or thousandth best idea.
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Investment success cannot be captured in a mathematical equation or a computer program.
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We are big fans of fear, and in investing it is clearly better to be scared than sorry.
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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.
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