Seth Klarman

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Seth Klarman
Born (1957-05-21) May 21, 1957 (age 59)
New York City, New York, U.S.
Residence Brookline, Massachusetts, U.S.
Nationality United States
Alma mater Cornell University
Harvard University
Occupation Investor, hedge fund manager, and philanthropist
Known for Founding and leading the Baupost Group
Net worth Increase US $1.38 billion (January 2016)[1]
Spouse(s) Beth Klarman

Seth Klarman (born May 21, 1957)[2][3] is an American investor, hedge fund manager, and philanthropist. He founded the Baupost Group, a Boston-based private investment partnership, and the author of a book on value investing titled Margin of Safety: Risk-Averse Value Investing Strategies for the Thoughtful Investor.

Early life and education[edit]

Klarman grew up in a Jewish[4][5][6] family in Baltimore, where his father was a public health economist at Johns Hopkins University[7] and his mother taught high school English.[8] Klarman graduated from Cornell University magna cum laude in economics.[9] He went on to attend Harvard Business School[10] where he was a Baker Scholar and was classmates with Jeffrey Immelt, Steve Burke, Stephen Mandel and Jamie Dimon.

Investment career[edit]

Before founding Baupost, Klarman worked for Max Heine and Michael Price of the Mutual Shares fund (now a part of Franklin Templeton Investments). He founded the Baupost Group in 1982, which managed USD 22 Billion as of 2010.[11] Despite his unconventional strategies, he has consistently achieved high returns.[12] 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.[13] He often makes unusual investments, buying unpopular assets while they are undervalued, using complex derivatives, and buying put options. Klarman typically keeps a low profile, rarely speaking in public or granting interviews. However, in 2006, he spoke pessimistically about the stock market and warned of future inflation.[14] He is sometimes referred to as "the Warren Buffett of his generation".[15]

Personal life[edit]

Klarman is married to Beth Klarman.[4] Klarman is the brother of Harvard Law Professor Michael Klarman.[7] Klarman 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.[16][17]

Political involvement[edit]

Klarman has donated to both Democrat and Republican groups and candidates.[18][4] Klarman is a major backer of political non-profits such as the Ending Spending Fund[19] and the pro-same-sex marriage American Unity Fund.[20] However, 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.”[18]

Wealth and philanthropy[edit]

In 2014 Forbes listed Seth Klarman as one of the 25 Highest-Earning hedge fund managers in 2013. His 2013 total earnings of $350 million ranks him the 20th among the 25 top earning hedge fund managers.[21]

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.[4] Klarman also is active with the 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.[4]

In 2013, Klarman donated the lead capital to fund the $61 million dollar building at Cornell University named the Seth ’79 and Beth Klarman Humanities Building, more simply known as Klarman Hall.[22]

Publications and works[edit]

  • Klarman, Seth. Margin of Safety, Risk Averse Investing Strategies for the Thoughtful Investor (1991)[23]

References[edit]

  1. ^ Forbes: The World's Billionaires: Seth Klarman April 2014
  2. ^ http://archive.breederscup.com/bio.aspx?id=27293[dead link]
  3. ^ The Oracle of Boston; Seth Klarman. The Economist (US) July 7, 2012
  4. ^ a b c d e Jewish Daily Forward: "The Softspoken Man Behind Times of Israel - Famed Investor Seth Klarman Says Site Won't Pull Punches" By Josh Nathan-Kazis February 29, 2012
  5. ^ Forbes Israel: Jewish Billionaires - Profile of Seth Klarman April 14, 2013 (in Hebrew)
  6. ^ Times of Israel: "The Jewish Origins of Value investing" by Gabriele Grego December 8, 2014
  7. ^ a b "Herbert Klarman, 82, professor, health economist", The Baltimore Sun, June 19, 1999.
  8. ^ Scott Cendrowski (February 15, 2012). "A hedge fund bets big on a Canadian mega quarry". CNN Money. Retrieved 2012-02-15. 
  9. ^ "Seth Klarman Resource Page". ValueWalk. Retrieved 2017-02-02. 
  10. ^ Fabrikant, Geraldine. (2007, May 13). Manager Frets Over the Market, but Still Outdoes It. New York Times, Investment section. Accessed on 10-25-2008.
  11. ^ Opportunities for Patient Investors, Financial Analysts Journal, Volume 66, Number 5, Seth A. Klarman and Jason Zweig
  12. ^ Baupost's Klarman sees poor outlook for stocks Reuters, Aaron Pressman and Matthew Lewis. May 18, 2010
  13. ^ The Wharton Journal Archived June 6, 2008, at the Wayback Machine. 12/5/05
  14. ^ Brett Arends (May 19, 2010). "Klarman: Why Investing Is Like Chess". Wall Street Journal. 
  15. ^ The Oracle of Boston, Economist
  16. ^ http://blogs.timesofisrael.com/a-note-from-the-chairman/
  17. ^ Nathan-Kazis, Josh (29 February 2012). "The Softspoken Man Behind Times of Israel". The Forward. Retrieved 17 March 2012. 
  18. ^ a b Viser, Matt and Jan, Tracy (20 July 2016). "Donald Trump is at the wheel, and road looks rocky". Boston Globe. Cleveland. Retrieved 21 July 2016. 
  19. ^ Sullivan, Sean (16 April 2014). "Who funded the super PAC hitting Dem and GOP candidates? These three billionaires.". Washington Post. Retrieved 7 July 2014. 
  20. ^ Confessore, Nicholas (26 April 2013). "Pushing the G.O.P. to Support Gay Rights". New York Times. Retrieved 7 July 2014. 
  21. ^ Vardi, Nathan (Feb 26, 2014), "The 25 Highest-Earning Hedge Fund Managers And Traders", Forbes 
  22. ^ "Klarman Hall project begins; scheduled to open in 2015 | Cornell Chronicle". news.cornell.edu. Retrieved 2017-02-02. 
  23. ^ The $700 Used Book. (2006, Aug. 7). BusinessWeek, Personal Finance section. Accessed 11-11-2008.

Further reading[edit]

  • [1] Notes from Seth Klarman's discussion at the CFA Institute's 2010 Annual Conference - May 18, 2010
  • Klarman, Seth (2007). Remarks at MIT (PDF). Website of Redfield, Blonsky & Co., LLC. Accessed 11-11-2008.
  • [2] Seth Klarman interview by Alpha
  • [3] Excerpts from 2005 Baupost Group Letter
  • [4] Seth Klarman video conference at Ben Graham Center for Value Investing
  • [5] Seth Klarman featured in Outstanding Investor's Digest March 2009
  • [6] Seth Klarman guest lecture at Harvard's Psychology of Leadership course - May 1, 2006

External links[edit]