Interview with Seth Klarman: Opportunities for Patient Investors ~ market folly

Monday, September 20, 2010

Interview with Seth Klarman: Opportunities for Patient Investors

A while back we detailed thoughts from Baupost Group's Seth Klarman where the legendary investor was worried about inflation and the markets. His comments came from the CFA's annual conference in Boston on May 16th-19th. While we had posted notes from the event before, today we're highlighting the full interview that Klarman had with Jason Zweig. If you're unfamiliar with Baupost Group, you can check out their portfolio as detailed in a free sample issue of hedge fund wisdom, our new newsletter. Additionally, you can read a profile of Seth Klarman here.

In the interview, Klarman touches on numerous topics ranging from his evolution as an investor, the financial crisis, and his current concerns. Additionally, Klarman recommended a few books which we compiled into a list. But we wanted to highlight what he learned as an investor from his early days at Mutual Shares, working for Max Heine and Mike Price. Of this Klarman says,

"What I learned from Mike—and I worked most closely with him—was the importance of an endless drive to get information and seek value. I remember a specific instance when he found a mining stock that was inexpensive. He literally drew a detailed map—like an organization chart—of interlocking ownership and affiliates, many of which were also publicly traded. So, identifying one stock led him to a dozen other potential investments. To tirelessly pull threads is the lesson that I learned from Mike Price.

With Max Heine, I learned a bit of a different lesson. Max was a great analyst and a brilliant investor—and he was a very kind man. I was most taken with how he treated people. Whether you were the youngest analyst at the firm, as I was, or the receptionist or the head of settlements, he always had a smile and a kind word. He treated people as though they were really important, because to him they were."

Embedded below is Klarman's full interview from the CFA conference:

You can download a .pdf copy here.

You can find out what Klarman is investing in via a free sample issue of hedge fund wisdom, a brand new quarterly publication by

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