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Quote by David F. Swensen

“Never underestimate the gullibility of large pools of money.”

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David F. Swensen is an influential expert in the field of investment, born in 1954. His career has been dedicated to investment management and education, with a deep understanding and unique insights into global financial markets. more

“Edge also implies what Ben Graham....called a margin of safety. You have a margin of safety when you buy an asset at a price that is substantially less than its value. As Graham noted, the margin of safety 'is available for absorbing the effect of miscalculations or worse than average luck.' ...Graham expands, "The margin of safety is always dependent on the price paid. It will be large at one price, small at some higher price, nonexistent at some still higher price."”

Stills Values Effects Higher Paid Safety Luck Average Edges Available Dependent Assets Margins Absorbing Miscalculations

Author:Michael Mauboussin

“At the core of an analytical edge is an ability to systematically distinguish between fundamentals and expectations. Fundamentals are a well thought out distribution of outcomes, and expectations are what's priced into an asset. A power metaphor is the [pari-mutuel] racetrack. The fundamentals are how fast a given horse will run and the expectations are the odds on the tote board. As any serious handicapper knows, you make money only by finding a mispricing between the performance of the horse and the odds. There are no 'good' or 'bad' horses, just correctly or incorrectly priced ones.”

Knows Wells Running Given Ability Serious Findings Expectations Performances Horse Fundamentals Metaphor Edges Core Making Money Boards Outcomes Assets Odds Distribution Totes

Author:Michael Mauboussin

“Warren Buffett has said many times that people either get value investing in five minutes or they won't get it in five years. So, there is something in the human brain, that for some of us, makes all the difference in the world right away and the patience it requires is part of the wiring process.”

People World Years Humans Said Values Process Differences Brain Five Minutes Investing Five Years Five Minutes Human Brain Buffett Wiring Warren Buffet

Author:Mohnish Pabrai

“People are, by and large, quite poor at judging correct absolute values but are astute about determining relative values. Psychologists call this coherent arbitrariness, which suggests that individuals are coherent when they compare prices on a relative basis but arbitrary when those prices are considered versus fundamental value.”

People Values Individual Poor Judging Bases Absolutes Fundamentals Compare Relative Versus Arbitrary Psychologist Astute Relative Value

Author:Michael Mauboussin

“Courage is a function of process.”

Process Function

Author:Seth Klarman

Quote by David F. Swensen

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