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Howard Marks

The Most Important Thing

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  • Вадим Мазурhas quoted2 years ago
    The Most Important Thing Is … Recognizing Risk
  • Вадим Мазурhas quoted2 years ago
    In short, in bull markets—usually when things have been going well for a while—people tend to say, “Risk is my friend. The more risk I take, the greater my return will be. I’d like more risk, please.”
  • Вадим Мазурhas quoted2 years ago
    So a prime element in risk creation is a belief that risk is low, perhaps even gone altogether. That belief drives up prices and leads to the embrace of risky actions despite the lowness of prospective returns.
  • Вадим Мазурhas quoted2 years ago
    The point is, people usually expect the future to be like the past and underestimate the potential for change.
  • Вадим Мазурhas quoted2 years ago
    No, I’m sure “risk” is— first and foremost— the likelihood of losing money
  • Вадим Мазурhas quoted2 years ago
    The correct formulation is that in order to attract capital, riskier investments have to offer the prospect of higher returns, or higher promised returns, or higher expected returns. But there’s absolutely nothing to say those higher prospective returns have to materialize.
  • Вадим Мазурhas quoted2 years ago
    But riskier investments absolutely cannot be counted on to deliver higher returns. Why not? It’s simple: if riskier investments reliably produced higher returns, they wouldn’t be riskier!
  • Вадим Мазурhas quoted2 years ago
    Risk means more things can happen than will happen
  • Вадим Мазурhas quoted2 years ago
    The market can remain irrational longer than you can remain solvent
  • Вадим Мазурhas quoted2 years ago
    Buying something for less than its value. In my opinion, this is what it’s all about—the most dependable way to make money. Buying at a discount from intrinsic value and having the asset’s price move toward its value doesn’t require serendipity; it just requires that market participants wake up to reality. When the market’s functioning properly, value exerts a magnetic pull on price
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