Seth Klarman

About Seth Klarman

Who is it?: CEO & President, Baupost Group
Birth Day: May 21, 1957
Birth Place: Chestnut Hill, Massachusetts, United States
Birth Sign: Gemini
Residence: Chestnut Hill, Massachusetts, U.S.
Alma mater: Cornell University (A.B.) Harvard University (M.B.A.)
Occupation: Investor, hedge fund manager, and philanthropist
Known for: Founding and leading the Baupost Group
Spouse(s): Beth Schultz Klarman (m. 1982)

Seth Klarman Net Worth

Seth Klarman was bornon May 21, 1957 in Chestnut Hill, Massachusetts, United States, is CEO & President, Baupost Group. Investment legend Seth Klarman runs Boston-based firm Baupost. With $30 billion under management, Baupost is one of the largest hedge funds. It posted solid returns of 9% net of fees in 2016. Klarman is seen as an expert in value investing. His book "Margin of Safety," a cult classic among investors, sells for as much as $4,000 on Amazon. An avid philanthropist, his foundation's assets hit $540 million as of the latest public filing. Klarman, whose philanthropic efforts focus on scientific research and promoting access to music learning, is also a major supporter of causes in Israel. He owns the digital, English-language Israeli newspaper Times of Israel.
Seth Klarman is a member of Finance and Investments

💰 Net worth: $1.5 Billion (Updated at 22 June 2018)

2013 $1.05 Billion
2014 $1.25 Billion
2015 $1.5 Billion
2016 $1.3 Billion
2017 $1.5 Billion
2018 $1.5 Billion

Some Seth Klarman images

Famous Quotes:

Firstly, Value investing is intellectually elegant. You’re basically buying bargains. It also appeals because all the studies demonstrate that it works. People who chase growth, who chase high fliers, inevitably lose because they paid a premium price. They lose to the people who have more patience and more discipline. Third, it’s easy to talk in the abstract, but in real life you see situations that are just plain mispriced, where an ignored, neglected, or abhorred company may be just as attractive as others in the same industry. In time, the discount will be corrected, and you will have the wind at your back as a holder of the stock.

Awards and nominations:

Klarman has been called a "hedge fund Titan," and "quiet giant of investing," for his slow accumulation of fund capital over his career (in 2008, his hedge fund was the 6th largest in the world) and low profile. It was reported by Andrew Ross Sorkin, of The New York Times, that "[Klarman] is the most successful and influential investor you have probably never heard of." His Investopedia entry has him listed as "an enigma in the investing world."

He is sometimes called "the Warren Buffett of his generation," and the "Oracle of Boston." It has even been speculated that his investment philosophy is so similar to Buffett's that he is considered a dark horse option to assume Berkshire Hathaway in the event of Buffett's death. According to an article by The New York Times, Buffett has publicly praised Klarman's investing, and it has been reported that Buffett keeps a copy of his book on his bookshelf.

In 2008, he was inducted into Institutional Investors Alpha's Hedge Fund Manager Hall of Fame along with David Swensen, Louis Bacon, Steven Cohen, Kenneth Griffin, Paul Tudor Jones, George Soros, Michael Steinhardt, Jack Nash, James Simons, Alfred Jones, Leon Levy, Julian Robertson, and Bruce Kovner.

Biography/Timeline

1957

Seth Andrew Klarman was born on May 21, 1957 in New York City. When he was six he moved to the Mt. Washington area of Baltimore, Maryland near the Pimlico Race Track, and grew up in a traditional Jewish family. His Father was a public health Economist at Johns Hopkins University and his mother taught high school English. His parents divorced shortly after their moving to Baltimore.

1979

Klarman attended Cornell University in Ithaca, New York, and was interested in majoring in mathematics but instead chose to pursue economics. He graduated magna cum laude in economics with a minor in history in 1979. In the summer of his junior year he interned at the Mutual Shares fund and was introduced to Max Heine and Michael Price. After graduating from college he went back to the company to work for 18 months before deciding to go to Business school. He went on to attend Harvard Business School where he was a Baker Scholar and was classmates with Jeffrey Immelt, Steve Burke, Stephen Mandel, James Long and Jamie Dimon.

1982

Klarman typically keeps a low profile, rarely speaking in public or granting interviews. He lives in Chestnut Hill, Massachusetts with his wife, Beth Schultz Klarman, whom he met on a Boston Harbor cruise in 1982; they have three children. His brother, Michael Klarman, is a professor at Harvard Law School.

2006

Klarman owns Klaravich Stables Inc. and has been racing horses with william Lawrence since 2006. Their horse Cloud Computing won the 2017 Preakness Stakes.

2008

He edited the 6th edition of Benjamin Graham and David Dodd's Security Analysis in 2008.

2009

In 2009, Klarman began buying distressed credits in the wake of the financial crisis of 2007–2008. He purchased the bonds of CIT Group, a financial holding company based in New York City at 65 cents on the dollar with a yield rate of 15%. After the company went into prepared bankruptcy, as Baupost began lending it money via a loan, Carl Icahn gave a loan of $6 billion to the CIT Group but backed out of the deal a week later. This caused the bonds to speed into prepared bankruptcy and gave the Baupost group securities valued at 80 cents to the dollar for their debt in CIT Group. Shortly after the CIT deal was finalized, Klarman amassed a stake in a new bio-tech company called FacetBiotech, at an average cost of $9 a share. At the time, FacetBiotech had $17 a share in net cash. Klarman noted that when stocks are spun off of their larger parent companies they become "cheap and ignored." When Biogen eventually tried a hostile takeover of the company bidding up the price to $14 a share, Abbott Laboratories asked for a $27 per share settlement for acquisition. Klarman's fund finished that year up +27%.

2010

Klarman started The Klarman Family Foundation ($255 million in assets as of 2010) which donates to medical causes, Jewish organizations (such as the American Jewish Committee, Boston’s Combined Jewish Philanthropies and Gann Academy), and Israeli causes. Klarman is the chairman of Facing History and Ourselves which develops classroom programs to combat anti-Semitism and bigotry. Klarman also is active with the Israel Project, a pro-Israel advocacy group that collects and provides information on Israel for journalists. He donated $4 million to the organization between 2008 and 2010. He is the key U.S. investor behind The Times of Israel, an online English-language newspaper which reports on Israel, the region and the Jewish world.

2013

In 2013, Klarman donated the lead capital to fund the $61 million building at Cornell University named the Seth ’79 and Beth Klarman Humanities Building, more simply known as Klarman Hall. A year later, he donated money to Harvard Business School to construct a "conference center/auditorium and performance space," named Klarman Hall. In an official statement he recalled his time at the school as "an important and ongoing role in my life," later noting it an honor "to able to give back to a school that has given us so much."

2015

He makes unusual Investments, buying unpopular assets while they are undervalued, using complex derivatives, and buying put options. During his first years running Baupost he made it a point to only invest in companies that were not widely accepted by the Wall Street community; he stressed managing risk and using the margin of safety. He is a very conservative investor, and often holds a significant amount of cash in his investment portfolios, sometimes in excess of 50% of the total. Despite his unconventional strategies, he has consistently achieved high returns. Klarman looks for companies that are traded at a discount (so he can assume shares with a margin of safety). Klarman and his fund usually go "bargain hunting," when companies are distressed or face low growth or declining years. It was reported by The Boston Globe in 2015 that when Energy stocks were declining, his firm "started looking for deals." According to Institutional Investor, "[Klarman] has succeeded by deftly exploiting under-valued markets whether they are in equities, Jun K bonds, bankruptcies, foreign bonds or real estate."

2016

In the 2016 Presidential election he gave the maximum donation of $5,400 to Hillary Clinton's campaign, stating that "Donald Trump is completely unqualified for the highest office in the land.”

2017

Klarman has written many annual letters to shareholders but has kept a limited role in writing articles, opinion editorials or books. In an interview with Charlie Rose, he discussed the popularity of his shareholder's letters and a request on behalf of HarperCollins to write and publish a book on investing. He followed up on this request by publishing his first and as of February 2017, his only book, Margin of Safety, Risk Averse Investing Strategies for the Thoughtful Investor, a reflection of value investing found in his hedge fund. In the book he outlines the various issues with Retail investing, and critiques small time Investors getting into the market purely using metrics such as price momentum and losing money in the long run. He issues that this is speculation and at times gambling, and should be discouraged in the market place. The book asserts that more people should become value Investors or people who invest in stocks that trade below their underlying value so as to purchase them at a discount.

2018

In February 2018, Forbes Magazine listed his personal fortune at US$1.50 billion. In 2015, Klarman was listed as the 15th highest earning hedge fund manager in the world. In 2008, he was inducted into Institutional Investors Alpha's Hedge Fund Manager Hall of Fame. He has drawn numerous comparisons to fellow value investor Warren Buffett, and akin to Buffett's notation as the "Oracle of Omaha," he is known as the "Oracle of Boston."

2019

Klarman has donated to both Democrat and Republican groups and candidates while being registered an independent. Klarman is a major backer of political non-profits such as the Ending Spending Fund and the pro-same-sex marriage American Unity Fund. He has stated: "I’m a complicated guy, I’m fairly nuanced in my views. I’m trying to do what I think is the right thing for the country."