Anything written by Seth Klarman is hard to come by. His book, Margin of Safety, is out of print and can only be found used at a famously high asking price. His Baupost letters are highly protected. And the few articles can be traced back to the ’80s and ’90s.
But in the writing, it’s apparent that Klarman is a value investor deeply rooted in Ben Graham’s teaching. The recurring theme — protecting capital is goal number one.
Another theme is the combination of flexibility and turning human nature to his advantage. The human psyche has some general tendencies that work really well in most circumstances except when it comes to investing. Klarman bargain hunts with that in mind but it often leads to areas investors are rushing to avoid.
There are other themes too, which are best left in his own words.
Here’s Klarman: Continue Reading…