Howard Marks Interview

Found via the Corner of Berkshire & Fairfax.

What is your secret sauce?

No. 1, it's possible, especially in inefficient markets, to gain a knowledge advantage. By definition, an inefficient market is one where hard work and skill can pay off. We can also control our psyche and emotions so that we don't make the human mistakes that are so common. Of course the other thing is we have a philosophy of controlling risk. So that doesn't necessarily make us the winner rather than the loser in the transaction, but it increases the probability that we engage in transactions of the sort that we and our clients want.

Does that mean you're not always swinging for the fences?

We're rarely, if ever, swinging for the fences. We think a high batting average rather than home runs is more important, and the clients who come to us want that.