Quiz on ” MARGIN OF SAFETY SUMMARY (BY SETH KLARMAN) “

1. What is the main difference between value investors and speculators?

a) Value investors focus on business cash flows, while speculators focus on price movements.

b) Value investors buy at high prices and sell at low prices, while speculators do the opposite.

c) Value investors prioritise short-term gains, while speculators aim for long-term growth.

2. According to Seth Klarman, why is price volatility a poor indicator of investment risk?

a) Price volatility is influenced by external factors that have no bearing on the underlying asset.

b) Price volatility fails to consider the nature of the asset and its price.

c) Price volatility only affects speculators, not value investors.

3. What is the recommended approach to investing, according to Seth Klarman?

a) Spend extensive time researching a few individual stocks.

b) Fully invest in the market to avoid missed opportunities.

c) Apply the 80/20 approach, exploring various investment opportunities.

Information