Howard Marks
- Published in print:
- 2013
- Published Online:
- November 2015
- ISBN:
- 9780231162845
- eISBN:
- 9780231530798
- Item type:
- book
- Publisher:
- Columbia University Press
- DOI:
- 10.7312/columbia/9780231162845.001.0001
- Subject:
- Economics and Finance, Financial Economics
In The Most Important Thing investing insight of this book’s author’s celebrated client memos was distilled into a single text and made his philosophy available to general readers. In this book, this ...
More
In The Most Important Thing investing insight of this book’s author’s celebrated client memos was distilled into a single text and made his philosophy available to general readers. In this book, this wisdom is joined by the comments, insights, and counterpoints of four renowned investors and investment educators. These experts lend insight into the most important concepts in successful investing, such as “second-level thinking,” the price/value relationship, patient opportunism, and defensive investing. The author also adds his own annotations, expanding on his book’s original themes and issues. A new chapter addresses the importance of reasonable expectations, and a foreword by Bruce C. Greenwald, called “a guru to Wall Street’s gurus” by the New York Times, speaks on value investing, productivity, and the economics of information. The book provides valuable lessons for critical thinking, risk assessment, and investment strategy. Encouraging investors to be “contrarian,” he judges market cycles and achieves returns through aggressive yet measured action. Which element is the most essential? Successful investing requires thoughtful attention to many separate aspects, and each of the book’s subjects proves to be the most important thing.Less
In The Most Important Thing investing insight of this book’s author’s celebrated client memos was distilled into a single text and made his philosophy available to general readers. In this book, this wisdom is joined by the comments, insights, and counterpoints of four renowned investors and investment educators. These experts lend insight into the most important concepts in successful investing, such as “second-level thinking,” the price/value relationship, patient opportunism, and defensive investing. The author also adds his own annotations, expanding on his book’s original themes and issues. A new chapter addresses the importance of reasonable expectations, and a foreword by Bruce C. Greenwald, called “a guru to Wall Street’s gurus” by the New York Times, speaks on value investing, productivity, and the economics of information. The book provides valuable lessons for critical thinking, risk assessment, and investment strategy. Encouraging investors to be “contrarian,” he judges market cycles and achieves returns through aggressive yet measured action. Which element is the most essential? Successful investing requires thoughtful attention to many separate aspects, and each of the book’s subjects proves to be the most important thing.
Howard Marks
- Published in print:
- 2011
- Published Online:
- November 2015
- ISBN:
- 9780231153683
- eISBN:
- 9780231527095
- Item type:
- book
- Publisher:
- Columbia University Press
- DOI:
- 10.7312/columbia/9780231153683.001.0001
- Subject:
- Economics and Finance, Financial Economics
After four decades spent ascending to the top of the investment management profession, the author of this book is today sought out by the world's leading value investors, and his client memos brim ...
More
After four decades spent ascending to the top of the investment management profession, the author of this book is today sought out by the world's leading value investors, and his client memos brim with insightful commentary and a time-tested, fundamental philosophy. Informed by the author's experience and study, this book explains the keys to successful investment and the pitfalls that can destroy capital or ruin a career. Utilizing passages from his memos to illustrate his ideas, the author teaches by example, detailing the development of an investment philosophy that fully acknowledges the complexities of investing and the perils of the financial world. Brilliantly applying insight to today's volatile markets, the book offers a volume that is part memoir, part creed, with a number of broad takeaways. It expounds on such concepts as “second-level thinking,” the price/value relationship, patient opportunism, and defensive investing. The book provides valuable lessons for critical thinking, risk assessment, and investment strategy. Encouraging investors to be “contrarian,” it wisely judges market cycles and achieves returns through aggressive yet measured action. Which element is the most essential? Successful investing requires thoughtful attention to many separate aspects, and each of the book's subjects proves to be the most important thing.Less
After four decades spent ascending to the top of the investment management profession, the author of this book is today sought out by the world's leading value investors, and his client memos brim with insightful commentary and a time-tested, fundamental philosophy. Informed by the author's experience and study, this book explains the keys to successful investment and the pitfalls that can destroy capital or ruin a career. Utilizing passages from his memos to illustrate his ideas, the author teaches by example, detailing the development of an investment philosophy that fully acknowledges the complexities of investing and the perils of the financial world. Brilliantly applying insight to today's volatile markets, the book offers a volume that is part memoir, part creed, with a number of broad takeaways. It expounds on such concepts as “second-level thinking,” the price/value relationship, patient opportunism, and defensive investing. The book provides valuable lessons for critical thinking, risk assessment, and investment strategy. Encouraging investors to be “contrarian,” it wisely judges market cycles and achieves returns through aggressive yet measured action. Which element is the most essential? Successful investing requires thoughtful attention to many separate aspects, and each of the book's subjects proves to be the most important thing.
Howard Marks
- Published in print:
- 2013
- Published Online:
- November 2015
- ISBN:
- 9780231162845
- eISBN:
- 9780231530798
- Item type:
- chapter
- Publisher:
- Columbia University Press
- DOI:
- 10.7312/columbia/9780231162845.003.0004
- Subject:
- Economics and Finance, Financial Economics
This chapter considers a well-known requirement for successful investing: establishing a healthy relationship between price and value. For a value investor, price has to be the starting point in ...
More
This chapter considers a well-known requirement for successful investing: establishing a healthy relationship between price and value. For a value investor, price has to be the starting point in investment success. No matter how good an investment sounds, if price has not yet been considered, the investor can’t know if it is a good investment. If their estimate of intrinsic value is correct, over time an asset’s price should converge with its value. To be sure that the price is right, a prospective buyer should be looking at the underlying fundamental value, but most of the time a security’s price will be affected at least as much—and its short-term fluctuations determined primarily—by two other factors: psychology and technicals. The key to understanding the price/value relationship lies primarily in insight into other investors’ minds. The chapter presents comments and insights from four well-known investors and investment educators.Less
This chapter considers a well-known requirement for successful investing: establishing a healthy relationship between price and value. For a value investor, price has to be the starting point in investment success. No matter how good an investment sounds, if price has not yet been considered, the investor can’t know if it is a good investment. If their estimate of intrinsic value is correct, over time an asset’s price should converge with its value. To be sure that the price is right, a prospective buyer should be looking at the underlying fundamental value, but most of the time a security’s price will be affected at least as much—and its short-term fluctuations determined primarily—by two other factors: psychology and technicals. The key to understanding the price/value relationship lies primarily in insight into other investors’ minds. The chapter presents comments and insights from four well-known investors and investment educators.
Howard Marks
- Published in print:
- 2011
- Published Online:
- November 2015
- ISBN:
- 9780231153683
- eISBN:
- 9780231527095
- Item type:
- chapter
- Publisher:
- Columbia University Press
- DOI:
- 10.7312/columbia/9780231153683.003.0004
- Subject:
- Economics and Finance, Financial Economics
This chapter describes a very important expectation for successful investing: establishing a healthy relationship between price and value. A fundamental premise of the efficient market hypothesis is ...
More
This chapter describes a very important expectation for successful investing: establishing a healthy relationship between price and value. A fundamental premise of the efficient market hypothesis is that if the investor buys something for its fair value, they can expect a return that is fair given the risk. However, active investors are not in it for fair risk-adjusted returns; they want superior returns. To be sure that the price is right, a prospective buyer should be looking at the underlying fundamental value, but most of the time a security's price will be affected at least as much—and its short-term fluctuations determined primarily—by two other factors: psychology and technicals. Whereas the key to ascertaining value is skilled financial analysis, the key to understanding the price/value relationship—and the outlook for it—lies largely in insight into other investors' minds. Investor psychology can cause a security to be priced just about anywhere in the short run, regardless of its fundamentals.Less
This chapter describes a very important expectation for successful investing: establishing a healthy relationship between price and value. A fundamental premise of the efficient market hypothesis is that if the investor buys something for its fair value, they can expect a return that is fair given the risk. However, active investors are not in it for fair risk-adjusted returns; they want superior returns. To be sure that the price is right, a prospective buyer should be looking at the underlying fundamental value, but most of the time a security's price will be affected at least as much—and its short-term fluctuations determined primarily—by two other factors: psychology and technicals. Whereas the key to ascertaining value is skilled financial analysis, the key to understanding the price/value relationship—and the outlook for it—lies largely in insight into other investors' minds. Investor psychology can cause a security to be priced just about anywhere in the short run, regardless of its fundamentals.
Howard Marks
- Published in print:
- 2011
- Published Online:
- November 2015
- ISBN:
- 9780231153683
- eISBN:
- 9780231527095
- Item type:
- chapter
- Publisher:
- Columbia University Press
- DOI:
- 10.7312/columbia/9780231153683.003.0020
- Subject:
- Economics and Finance, Financial Economics
This concluding chapter recapitulates the author's ideas on successful investing. The best foundation for a successful investment—or a successful investment career—is value. To achieve superior ...
More
This concluding chapter recapitulates the author's ideas on successful investing. The best foundation for a successful investment—or a successful investment career—is value. To achieve superior investment results, the investor's insight into value has to be superior. Thus they must learn things others don't, see things differently or do a better job of analyzing them—ideally, all three. The investor's view of value has to be based on a solid factual and analytical foundation, and it has to be held firmly. Only then will they know when to buy or sell. The relationship between price and value holds the ultimate key to investment success. Buying below value is the most dependable route to profit. The price/value relationship is influenced by psychology and technicals, forces that can dominate fundamentals in the short run. Other important things to take into account by investors are contrarianism, defensive investing, risk control, and margin for error.Less
This concluding chapter recapitulates the author's ideas on successful investing. The best foundation for a successful investment—or a successful investment career—is value. To achieve superior investment results, the investor's insight into value has to be superior. Thus they must learn things others don't, see things differently or do a better job of analyzing them—ideally, all three. The investor's view of value has to be based on a solid factual and analytical foundation, and it has to be held firmly. Only then will they know when to buy or sell. The relationship between price and value holds the ultimate key to investment success. Buying below value is the most dependable route to profit. The price/value relationship is influenced by psychology and technicals, forces that can dominate fundamentals in the short run. Other important things to take into account by investors are contrarianism, defensive investing, risk control, and margin for error.
Howard Marks
- Published in print:
- 2013
- Published Online:
- November 2015
- ISBN:
- 9780231162845
- eISBN:
- 9780231530798
- Item type:
- chapter
- Publisher:
- Columbia University Press
- DOI:
- 10.7312/columbia/9780231162845.003.0021
- Subject:
- Economics and Finance, Financial Economics
This concluding chapter recaps the most important requirements for successful investing. It reiterates the argument that the best foundation for a successful investment—or a successful investment ...
More
This concluding chapter recaps the most important requirements for successful investing. It reiterates the argument that the best foundation for a successful investment—or a successful investment career—is value. To achieve superior investment results, the investor must have superior insight into value. In order to know when to buy or sell, the investor’s view of value has to be based on a solid factual and analytical foundation. The price/value relationship, which is influenced by psychology and technicals, holds the ultimate key to investment success. Buying below value is the most dependable route to profit; it is also a key element in limiting risk. Other important factors that investors need to take into account are risk control, contrarianism, defensive investing, avoiding the pitfalls, and having reasonable expectations.Less
This concluding chapter recaps the most important requirements for successful investing. It reiterates the argument that the best foundation for a successful investment—or a successful investment career—is value. To achieve superior investment results, the investor must have superior insight into value. In order to know when to buy or sell, the investor’s view of value has to be based on a solid factual and analytical foundation. The price/value relationship, which is influenced by psychology and technicals, holds the ultimate key to investment success. Buying below value is the most dependable route to profit; it is also a key element in limiting risk. Other important factors that investors need to take into account are risk control, contrarianism, defensive investing, avoiding the pitfalls, and having reasonable expectations.
