Howard Marks
An excellent company can be a poor investment at the wrong price. Second-level thinking weighs what the price assumes, the range of outcomes, and the risk to capital.
Second-level thinking involves digging deeper than the consensus to uncover mispriced assets and hidden opportunities.
Investment risk is not simply price volatility but rather the probability of a permanent loss of capital.
Investors must insist on a margin of safety by purchasing assets at prices significantly below their intrinsic value.