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Do not trust financial market risk models. Despite the predilection of some analysts to model the financial markets using sophisticated mathematics, the markets are governed by behavioral science, not physical science.

Seth Klarman

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Seth Klarman
Age: 67
Born: 1957
Born: May 21
New York City
New York
Seth Andrew Klarman
Physical
Sophisticated
Trust
Model
Risk
Despite
Science
Mathematics
Predilection
Using
Behavioral
Market
Analysts
Financial
Governed
Models
Markets

More quotes by Seth Klarman

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We don't deal in absolutes. We deal in probabilities.
Seth Klarman
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People should be highly sceptical of anyone's including their own, ability to predict the future, and instead pursue strategies that can survive whatever may occur.
Seth Klarman
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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.
Seth Klarman
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Having clients with a long-term orientation is crucial. Nothing else is as important to the success of an investment firm.
Seth Klarman
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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.
Seth Klarman
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Complexity - limits competition.
Seth Klarman
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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.
Seth Klarman
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If you've just stared into the abyss, quickly forget it: the lessons of history can only hold you back.
Seth Klarman
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Ultimately, nothing should be more important to investors than the ability to sleep soundly at night.
Seth Klarman
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When a stock is selling at a discount to liquidation value per share, a near rock-bottom appraisal, it is frequently an attractive investment.
Seth Klarman
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Individual and institutional investors alike frequently demonstrate an inability to make long-term investment decisions based on business fundamentals.
Seth Klarman
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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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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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Investing is the intersection of economics and psychology.
Seth Klarman
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Risk is not inherent in an investment it is always relative to the price paid. Uncertainty is not the same as risk. Indeed, when great uncertainty - such as in the fall of 2008 - drives securities prices to especially low levels, they often become less risky investments.
Seth Klarman
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When a government official says a problem has been contained, pay no attention.
Seth Klarman
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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.
Seth Klarman
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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.
Seth Klarman
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I find value investing to be a stimulating, intellectually challenging, ever changing, and financially rewarding discipline
Seth Klarman
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Because investors are not usually penalized for adhering to conventional practices, doing so is the less professionally risky strategy, even though it virtually guarantees against superior performance.
Seth Klarman