By Mebane Faber in Forbes:

While relatively unknown to the public, Seth Klarman is a superstar in institutional investing circles.

His out-of-print book Margin of Safety: Risk-Averse Value Investing Strategies for the Thoughtful Investor regularly sells for nearly $1,000 on eBay and Amazon. Why are investors so anxious to hear what he has to say?

From 1983 to 2008 his hedge fund, the Baupost Group, returned 16.5% a year, outperforming the S&P 500 by more than 6% a year. In the 10 years ending Dec. 31, 2008, he beat the market by an impressive 14.5% a year.

Those returns are net of all hedge fund fees and include only one losing year.

Even more impressive is that Klarman achieved this record with no leverage and minimal amounts of shorts, often while holding significant amounts of cash...

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