A Quote by Seth Klarman

The risk of an investment is described by both the probability and the potential amount of loss. The risk of an investment-the probability of an adverse outcome-is partly inherent in its very nature. A dollar spent on biotechnology research is a riskier investment than a dollar used to purchase utility equipment. The former has both a greater probability of loss and a greater percentage of the investment at stake.

Seth Klarman

Quote Topics

Adverse Amount Biotechnology Both Dollar Equipment Former Greater Inherent Investment Loss Nature Outcome Partly Percentage Potential Probability Purchase Research Risk Spent Stake Than Used Utility Very

Quote Author

Seth Klarman
American - Author
Born: May 21, 1957

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.

Seth Klarman

A realistic definition of risk recognizes the potential loss of capital through inflation and taxes, and would include at least the following two factors: The probability that the investment you chose will preserve your capital over the time you intend to invest your funds. The probability the investments you select will outperform alternative investments for this period.

David Dreman

Maybe we should teach schoolchildren probability theory and investment risk management.

Andrew Lo

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.

Seth Klarman

A new product, technology, or innovation - such as Bitcoin - has the potential to give rise both to frauds and high-risk investment opportunities. Potential investors can be easily enticed with the promise of high returns in a new investment space and also may be less skeptical when assessing something novel, new, and cutting-edge.

Perianne Boring

Ladies and gentlemen: There can be no greater investment in Alabama's future than an investment in education.

Bob Riley

When I bought my first house in London with my husband-to-be, our surveyor said: "Nicki, you're paying top dollar, but it's not an investment," and I said: "But we're buying a home, not an investment."

Nicki Chapman

Take the probability of loss times the amount of possible loss from the probability of gain times the amount of possible gain. That is what we're trying to do. It's imperfect, but that's what it's all about.

Warren Buffett

Growth demands investment, and investment demands stability. So the more Obama stirs the pot with his proposals and potential changes, the more he retards exactly the investment he needs to get the economy moving again.

Dick Morris

India needs three things for its energy sector: investment, investment, and investment.

Fatih Birol

Dollar for dollar there is no better investment in the world than a book

Ryan Holiday

A thoughtful investment process contemplates both probability and payoffs and carefully considers where the consensus - as revealed by a price - may be wrong. Even though there are also some important features that make investing different than, say, a casino or the track, the basic idea is the same: you want the positive expected value on your side

Michael Mauboussin

It is a tenet of my investment style that, on the subject of common stock investment, maximizing the upside means first and foremost minimizing the downside. The deleterious effect of permanent capital loss on portfolio returns cannot be overstated.

Michael Burry

In my view, the biggest investment risk is not the volatility of prices, but whether you will suffer a permanent loss of capital. Not only is the mere drop in stock prices not risk, but it is an opportunity. Where else do you look for cheap stocks?

Li Lu

There is no such thing as guaranteed high investment returns. Be wary of anyone who promises that you will receive a high rate of return on your investment with little or no risk.

Perianne Boring

I believe that investment in sports is investment in youth. And that, in turn, is investment in the future.