📖Seth Klarman
Intellectual Honesty
Intellectual honesty is the investor's greatest asset.
The greatest gift an investor can develop is intellectual honesty — the willingness to say 'I don't know' and to change your mind when evidence warrants it.
🏠 Everyday Analogy
📖 Core Interpretation
Seth Klarman advocates a repeatable process: define criteria, execute consistently, and review decisions against evidence. Process quality drives outcome consistency.
💎 Key Insight：Willingness to say 'I don't know' prevents costly mistakes.
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❓ Why It Matters
Without process, there is no reliable feedback loop. Structured execution and review improve decision quality over time.
🎯 How to Practice
Run a decision loop of research, thesis, execution, and post-mortem; document assumptions and update playbooks with evidence, not hindsight bias.
⚠️ Common Pitfalls
Having opinions without execution criteria
Reviewing outcomes but not decisions
Abandoning rules during volatility spikes
📚 Case Studies
1
KPN and América Móvil Bid (2013)
Baupost invested in Dutch telecom KPN amid a takeover attempt by América Móvil, expecting bids, asset sales, and regulatory decisions to unlock value.
✨ Outcome：The partial bid and corporate actions highlighted underlying value; position was reportedly profitable as spreads narrowed and risk reduced.
2
U.S. Savings and Loan Liquidations (1989)
Baupost bought assets from failed S&Ls during the thrift crisis, including discounted real-estate and loans sold via RTC auctions.
✨ Outcome：Positions purchased at steep discounts; as assets were liquidated and values realized, the investments delivered strong, uncorrelated returns.
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