We are big fans of fear, and in investing it is clearly better to be scared than sorry.

If only one word is to be used to describe what Baupost does, that word should be: 'Mispricing'. We look for mispricing due to over-reaction.

Why should the immediate opportunity set be the only one considered, when tomorrow's may well be considerably more fertile than today's?

Value investing is risk aversion.

Individual and institutional investors alike frequently demonstrate an inability to make long-term investment decisions based on business fundamentals.

Investing is the intersection of economics and psychology. The analysis is actually the easy part. The economics, the valuation of the business isn't that hard. The psychology - how much do you buy, do you buy it at this price, do you wait for a lower price, what do you do when it looks like the world might end - those things are harder. Knowing whether you stand there, buy more, or whether something has legitimately gone wrong and you need to sell, those are harder things. That you learn with experience, by having the right psychological makeup.

The cost of performing well in bad times can be relative underperformance in good times.