Why Margin of Safety Matters More Than Ever

During their recent episode, Taylor, Carlisle, and Ashton discussed Why Margin of Safety Matters More Than Ever, here’s an excerpt from the episode:

And also, after 2022, which was very interesting, I think there are a lot of value investors now who are not– They rely much more on the quality of the business for the margin of safety than anything else. I’m a huge believer that what differentiates value investors of all flavors is it’s somewhere in the portfolio, there’s a margin of safety against this permanent catastrophic loss that people talk about, which is, it’s not that you can prevent your stocks from going down in the near term, because you really can’t control what the market will do. But over time, if you’ve really done your job, your portfolio should recover within a reasonable period of time, so those losses don’t become permanent.

That may have been lost a little bit. And so, I got a few calls towards the end of 2022 from former Centaur partners saying, “Hey, I don’t know that there are people who think about risk the way that you do anymore. I have a piece of my portfolio I’d like for you to manage.” And so, it was just nice to get those calls, because it’s not something you necessarily can expect. But I’m very grateful for that. Many of the investors that were with me and Centaur, they’re with me with my new fund. I’m very grateful that they would trust me with their capital again.

Tobias: So, [crosstalk] a little bit–

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