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Pressure to produce over the short term - a gun to the head of everyone - encourages excessive risk taking which manifests itself in several ways - fully invested posture at all times, the use of leverage, and a market centric orientation that makes it difficult to stand apart from the crowd and take a long term perspective.

Seth Klarman

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Seth Klarman
Age: 67
Born: 1957
Born: May 21
New York City
New York
Seth Andrew Klarman
Makes
Stand
Fully
Posture
Take
Ways
Market
Invested
Long
Head
Pressure
Orientation
Way
Term
Perspective
Crowd
Centric
Times
Short
Crowds
Manifests
Everyone
Produce
Several
Leverage
Use
Taking
Gun
Encourages
Difficult
Risk
Apart
Excessive

More quotes by 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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When managers are afraid of redemptions, they get liquid. We all saw how many managers went from leveraged long in 2007 to huge net cash in 2008, when the right thing to do in terms of value would have been to do the opposite.
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Investing is the intersection of economics and psychology.
Seth Klarman
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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.
Seth Klarman
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A value strategy is of little use to the impatient investor since it usually takes time to pay off.
Seth Klarman
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The stock market is the story of cycles and of the human behavior that is responsible for overreactions in both directions.
Seth Klarman
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Complexity - limits competition.
Seth Klarman
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Hold cash when opportunities are not presenting themselves.
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
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In reality, no one knows what the market will do trying to predict it is a waste of time, and investing based upon that prediction is a speculative undertaking.
Seth Klarman
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Like to have a catalyst - reduces dependence on the market: Distressed debt inherently has a catalyst - maturity.
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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Patience and discipline can make you look foolishly out of touch until they make you look prudent and even prescient
Seth Klarman
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It turns out that value investing is something that is in your blood. There are people who just don't have the patience and discipline to do it, and there are people who do. So it leads me to think it's genetic.
Seth Klarman
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In a crisis, stocks of financial companies are great investments, because the tide is bound to turn. Massive losses on bad loans and soured investments are irrelevant to value improving trends and future prospects are what matter, regardless of whether profits will have to be used to cover loan losses and equity shortfalls for years to come.
Seth Klarman
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Investors need to pick their poison: Either make more money when times are good and have a really ugly year every so often, or protect on the downside and don't be at the party so long when things are good.
Seth Klarman
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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.
Seth Klarman
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Investing today may well be harder than it has been at any time in our three decades of existence.
Seth Klarman
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A commodity doesn't have the same characteristics as a security, characteristics that allow for analysis. Other than a recent sale or appreciation due to inflation, analyzing the current or future worth of a commodity is nearly impossible.
Seth Klarman
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Depressions aren't good but the depression mentality is good.
Seth Klarman