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Value investing is the discipline of buying shares at a significant discount from their current underlying values and holding them until more of their value is realised. The element of a bargain is the key to the process.

Seth Klarman

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Seth Klarman
Age: 67
Born: 1957
Born: May 21
New York City
New York
Seth Andrew Klarman
Process
Investing
Bargains
Significant
Underlying
Keys
Realised
Elements
Element
Discipline
Current
Discount
Value
Holding
Discounts
Share
Currents
Bargain
Values
Buying
Shares

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Investing today may well be harder than it has been at any time in our three decades of existence.
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Almost no one will accept responsibility for his or her role in precipitating a crisis: not leveraged speculators, not willfully blind leaders of financial institutions, and certainly not regulators, government officials, ratings agencies or politicians.
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One of the biggest challenges in investing is that the opportunity set available today is not the complete opportunity set that should be considered. Limiting your opportunity set to the one immediately at hand would be like limiting your spouse to the students you met in high school
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If you've just stared into the abyss, quickly forget it: the lessons of history can only hold you back.
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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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Individual and institutional investors alike frequently demonstrate an inability to make long-term investment decisions based on business fundamentals.
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Things that have never happened before are bound to occur with some regularity. You must always be prepared for the unexpected, including sudden, sharp downward swings in markets and the economy. Whatever adverse scenario you can contemplate, reality can be far worse.
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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.
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Ultimately, nothing should be more important to investors than the ability to sleep soundly at night.
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Hold cash when opportunities are not presenting themselves.
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The overwhelming majority of people are comfortable with consensus, but successful investors tend to have a contrarian bent.
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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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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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Value investing is predicated on the efficient market hypothesis being wrong.
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Benjamin Graham wrote, Those with enterprise haven't the money, and those with money haven't the enterprise, to buy stocks when they are cheap.
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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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Investment success cannot be captured in a mathematical equation or a computer program.
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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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Be focused on process and not outcome
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Value investing requires a great deal of hard work, unusually strict discipline, and a long-term investment horizon. Few are willing and able to devote sufficient time and effort to become value investors, and only a fraction of those have the proper mind-set to succeed.
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