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Quote by Seth Klarman

“In the financial markets, however, the connection between a marketable security and the underlying business is not as clear-cut. For investors in a marketable security the gain or loss associated with the various outcomes is not totally inherent in the underlying business; it also depends on the price paid, which is established by the marketplace. The view that risk is dependent on both the nature of investments and on their market price is very different from that described by beta.”

Quote by Seth Klarman

Author

Seth Klarman is an American author and value investor, serving as the president of The Baupost Group, a Boston-based investment firm. He is renowned for his extensive contributions to the field of value investing and has authored several books on the subject, most notably 'Margin of Safety: Risk-Averse Investing Strategies for the Thoughtful Investor'. more

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“Unlike return, however, risk is no more quantifiable at the end of an investment that it was at its beginning. Risk simply cannot be described by a single number. Intuitively we understand that risk varies from investment to investment: a government bond is not as risky as the stock of a high-technology company. But investments do not provide information about their risks the way food packages provide nutritional data.”

Way Ends Government Numbers Company Technology Risk Information Return Investment Investing Data Packages Vary High Technology

Author:Seth Klarman

“Rather, risk is a perception in each investor's mind that results from analysis of the probability and amount of potential loss from an investment. If an exploratory oil well proves to be a dry hole, it is called risky. If a bond defaults or a stock plunges in price, they are called risky. But if the well is a gusher, the bond matures on schedule, and the stock rallies strongly, can we say they weren't risky when the investment after it is concluded than was known when it was made.”

Ifs Mind Wells Made Loss Results Known Risk Amount Prove Perception Investment Investing Oil Holes Analysis Dry Investors Schedules Probability Plunge Default

Author:Seth Klarman

“There are only a few things investors can do to counteract risk: diversify adequately, hedge when appropriate, and invest with a margin of safety. It is a precisely because we do not and cannot know all the risks of an investment that we strive to invest at a discount. The bargain element helps to provide a cushion for when things go wrong.”

Knows Helping Can Do Risk Elements Safety Investment Strive Investing Appropriate Investors Margins Bargains Discounts Cushions When Things Go Wrong

Author:Seth Klarman

“I have no use whatsoever for projections or forecasts. They create an illusion of apparent precision. The more meticulous they are, the more concerned you should be. We never look at projections, but we care very much about, and look very deeply at, track records. If a company has a lousy track record, but a very bright future, we will miss the opportunity.”

Ifs Should Looks Use Care Opportunity Company Records Missing Illusion Concerned Investing Track Projection Precision Very Deep Forecasts Track Record Bright Future Meticulous

Author:Warren Buffett

“Hip-hop is a beautiful thing. I think that the music genre itself has created more millionaires than any other music genre before it, especially in our community.”

Thinking Beautiful Community Hip Hop Hips Genre Hops Beautiful Things Millionaire Our Community

Author:Steve Harvey

“Projections are put together by people who have an interest in a particular outcome, have a subconscious bias, and its apparent precision makes it fallacious. They remind me of Mark Twain's saying, 'A mine is a hole in the ground owned by a liar.' Projections in America are often a lie, although not an intentional one, but the worst kind because the forecaster often believes them himself.”

People Believe Kind Together America Lying Interest Worst Mines Particular Mark Investing Holes Outcomes Liars Bias Subconscious Projection Precision

Author:Charlie Munger

“It's amazing how many people even today use a computer to do something you can do with a pencil and paper in less time.”

People Use Today Can Do Paper Computer Simplicity Pencils

Author:Richard P. Feynman

“Part of that, I think, is being able to tune out folly, as distinguished from recognizing wisdom. You've got whole categories of things you just bat away so your brain isn't cluttered with them. That way, you're better able to pick up a few sensible things to do.”

Thinking Way Whole Able Brain Picks Simplicity Things To Do Folly Tunes Categories Sensible Bats Recognizing Distinguished

Author:Charlie Munger

“To avoid the various foolish opinions to which mankind are prone, no superhuman genius is required. A few simple rules will keep you, not from all error, but from silly error.”

Simple Opinion Mankind Genius Errors Simplicity Various Foolish Silly Superhuman

Book:The Basic Writings of Bertrand Russell

Source: The Basic Writings of Bertrand Russell

“There never was a sounder logical maxim of scientific procedure than Ockham's razor: Entia non sunt multiplicanda praeter necessitatem. That is to say; before you try a complicated hypothesis, you should make quite sure that no simplification of it will explain the facts equally well.”

Should Trying Wells Facts Simplicity Complicated Logical Hypothesis Maxims Procedures Razors Simplification Sounder

Book:Pragmatism as a Principle and Method of Right Thinking: The 1903 Harvard Lectures on Pragmatism

Source: Pragmatism as a Principle and Method of Right Thinking: The 1903 Harvard Lectures on Pragmatism