Seth Klarman Investing Philosophy
Seth Klarman invests in a wide array of investments ranging from fairly traditional value stocks to more esoteric investments like distressed debt, liquidations, and foreign equities or bonds. Klarman doesn't mind "doing nothing" on occasion. He is completely unperturbed by the idea of sitting on the sidelines holding cash whenever investment opportunities are scarce. In fact, in 2005 and 2006, nearly half of his portfolio was held in cash. Investing, he cautions, is more than just producing absolute returns. Too often investors focus on that one easy number "return" and ignore the risks incurred to generate that number.
Performance of Baupost Fund
|Year||Return %||S&P500 %||Excess Gain %|
|3-Year Cumulative (1999-2001)||14.12 (4.50/Year)||-7.30 (-2.48/Year)||21.42 (6.98/Year)|
|5-Year Cumulative (1997-2001)||85.15 (13.11/Year)||54.81 (9.13/Year)||30.34 (3.98/Year)|