The principle behind it is to invest in securities, namely stocks, when their market price is well below the actual value. Simply put, it is “the difference between the intrinsic value of a stock and its market price.” It also refers to how far a business’ sales can fall before breaking even. While Margin of Safety is the title of the book, it refers to an aspect of the stock market. The terminology is important, as it helps you to understand more of what Klarman discusses in the chapters of the book.
The first aspect is the investment term, and the second is the content of the book itself. Understanding Margin of Safety is two-fold. What Is Margin of Safety and What Is It About? What is this book all about, though, and is it worth your hard-earned cash?Ĭan the secrets contained in this book written by a billionaire help you to make money on your investments, or is this another marketing scheme to make a rich man richer? We dive into the contents and every other aspect of this book to help you make an educated buying decision.
Scarce, costly, and driving the investment community mad for two decades are all precise descriptions of Seth Klarman’s Margin of Safety.
