Seth Klarman on Value Investing in Bull Market

Dear Investors,

I came across a really great article this morning that I wanted to pass on to you, as it is highly relevant in today’s market environment.

In a bull market, the person that looks smartest in the short-term is generally the one that is most aggressive.  Almost always, those people get burned in the corresponding bear market, and they are usually late to the actual bull market when many of the most explosive gains tend to occur.

At T&T Capital Management (TTCM), we take a business-like deep value approach, emulating the methods used by those with the best long-term track records.  We may not win the 100-meter dash every year, but our goal is to finish the race and hopefully win the marathon of reaching or exceeding your financial goals.  I don’t want to write too much myself, as I want you to read the article, but I’ll highlight my favorite quote from it, written by Seth Klarman.  For those of you that don’t know, Klarman is one of the most successful investors in history with a multi-decade track record that is on par with the best. is an outstanding website by the way that always puts out fantastic info like this.

I hope that you enjoy and interestingly, we are coming up on our 7-year anniversary in October like Klarman was when he wrote this:

“If the financial markets remain turbulent and retrace some of their decade-long gains, I believe we will be in a strong position. Despite delivering good investment performance over the Fund’s first seven years of operations, I must remind you that value investing is not designed to outperform in a bull market. In a bull market, anyone, with any investment strategy or none at all, can do well, often better than value investors. It is only in a bear market that the value investing discipline becomes especially important because value investing, virtually alone among strategies, gives you exposure to the upside with limited downside risk. In a stormy market, the value investing discipline becomes crucial, because it helps you find your bearings when reassuring landmarks are no longer visible.”

Seth Klarman: Value Investing In Bull Markets



Tim Travis