Tips by Seth Klarman

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It's not amazing that securitized products were created. There are huge financial incentives for the people involved. What's amazing is that anybody...
Institutional constraints and market inefficiencies are the primary reasons that bargains develop. Investors prefer businesses and securities that are...
We think it's madness to target a return. Return lies in some relationship to risk, albeit there are moments when it's out of whack, when you can make...
Tags: returns, targets
In capital markets, price is set by the most panicked seller at the end of a trading day; value, which is determined by cash flows and assets, is not....
Tags: price, value, emotions
A margin of safety is achieved when securities are purchased at prices sufficiently below underlying value to allow for human error, bad luck, or...
Investors in a stock expect to profit in at least one of three possible ways: a. From free cash flow generated by the underlying business, which will...
Tags: investing
First, value investing is intellectually elegant. You're basically buying bargains. It also appeals because all the studies demonstrate that it works....
Value investing is the discipline of buying securities at a significant discount from their current underlying values and holding them until more of...
Value investing lies at the intersection of economics and psychology. Economics is important because you need to understand what assets or businesses...
Things that have never happened before are bound to occur with some regularity. You must always be prepared for the unexpected, including sudden,...
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