- Hardcover: 249 pages
- Publisher: HarperCollins; 1st edition (October 1991)
- Language: English
- ISBN-10: 0887305105
- ISBN-13: 978-0887305108
- Product Dimensions: 1 x 6.8 x 9.8 inches
- Shipping Weight: 1.2 pounds
- Average Customer Review: 3.8 out of 5 stars See all reviews (40 customer reviews)
- Amazon Best Sellers Rank: #1,031,981 in Books (See Top 100 in Books)
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Margin of Safety: Risk-Averse Value Investing Strategies for the Thoughtful Investor 1st Edition
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Top Customer Reviews
Seth Klarman, the portfolio manager of The Baupost Group, is a very successful practitioner of the value investing strategy. In this book, he sets out to educate the reader on this concept, stressing the advantages of a risk-averse approach. In his introduction, Klarman states that even if this book, as a side effect of educating more people to invest in a more sophisticated manner, causes diminished returns to himself - he considers it well worth it for the public good. While I highly applaud this mentality, it begs the question: why was the book not published again? Considering what I mentioned in the first paragraph, clearly there is significant demand to read it. Anyway, on to the book itself...
"Margin of Safety" is divided into three portions. The first part discusses where most investors make mistakes and stumble - it covers investing vs. speculation, the nature of Wall Street, and how institutional investing results in a short-term performance derby (of which the client is ultimately the loser). It also encapsulates the presented information in a thoughful case study of junk bonds in the 1980s. The second portion of the book introduces the details of the value-investment philosophy, primarily focusing on risk and how it is crucial to invest with a margin of safety. The last part provides useful applicable advice on actually following the value-investment process: where to find investment opportunities, how to invest in these opportunities, and various aspects of overall portfolio management.Read more ›
The content is impressive, somewhat unique and very incisive, however, I think that in the year 2008, with copies of this book selling for $1500+, Margin Of Safety is now only 50% "book" with the remaining 50% being folklore and mythology. Owning a physical copy of MOS has become like a $25,000 wristwatch for value investors. It isn't about telling time... It's about how much you spent and showing the world what you have... and yes, you will find that the "value investors" who spent four figures for a copy of this book will defend their prize purchase to their dying breaths.
That Klarman has never ordered a reprint of this book tells us that he probably regrets having published it in the first place, not because it's a bad book but quite to the contrary, because it's a very good book that outlines much of his game plan; the profitability of which is greater the fewer competitors he has practicing it along with him.
Having finally "proven" everything he wrote in MOS with the Buffett'esque performance of his Baupost Group, I would wager that if he could go back in time and 'unpublish' this book, he probably would.
Still, would I ever pay this kind of money for a copy?
Heck no. Of course, I won't buy a $10,000 wristwatch, either.
Needless to say it was an average book on value investing. And I stress average. If you're going to spend anything over $100 for this book, don't. If you still need to read it, get it from a library, but you'll still see that it probably wasn't worth it. All the clout that this book gets from being so pricey doesn't merit either trying to find it, or paying the price.
That being said, the author didn't have enough real life examples. He talked about a few companies that he realized significant gains on, but the intricacy of how he did it is not really discussed at length like Peter Lynch does in his books.
All in all, don't waste your money, and read one of the more popular Lynch or Graham books on value investing which are better written and more detailed.
Whalewisdom is another website where you can get a more user friendly 13F forms to review.
Most Recent Customer Reviews
It occurs to me that if people are willing to pay so much for a book that is hard to get it would be reprinted. Read morePublished 14 months ago by HARRY MARTZ
Its Okay, more of a cult classic than a book on investing.
If you want to learn the investment philosophy of a world class investor than its an ok read and for a value... Read more
Seth Klarman is a 5 Star Investor
I think this is a 5 star book at a 1 star price
So, do as I did and download the book off the internet for the cost of a)... Read more
It defies belief why anyone would pay up to $3000 for a copy of this book. Surely such behavior goes against the very principals of the book, considering it probably retailed at... Read morePublished on March 25, 2014 by The no-nonsense reviewer
Book is OK. Not sure what all the hype is about. Why would anyone pay so much when the PDF is available online?Published on December 26, 2013 by Gary Snider
This book is extremely overpriced for something that is this dated. Out-of-print does not automatically mean it's valuable. It could also mean that it was not worth reprinting. Read morePublished on November 14, 2013 by Diane
Everybody knows about Warren Buffett, and Buffett is undoubtedly the most successful value investor of the last 50 years. Read morePublished on January 12, 2013 by investingbythebooks
MARGIN OF SAFETY BOOK REVIEW
Whilst the content of the book seems to have been written mainly at one time (possibly the first edition) the chapter... Read more