When Forever Ends Watch Out Below! Baupost’s Klarman Reflects On 2018

In some ways the financial markets are a bit like musical chairs, leaving everyone scrambling for a seat when the music ends. Unfortunately, during long bull markets characterized by extreme excess, many investors begin to feel invincible, as if the music will never stop. However, all good things must come to an end, and the longest bull market in history may have finally be on its way out.

Q4 hedge fund letters, conference, scoops etc

Also see more 2018 Baupost coverage

• Seth Klarman 2018 Letter: Balancing Risk Aversion With Risk-Taking
• When Forever Ends: Baupost’s Klarman Reflects On 2018
• Baupost’s Klarman Outlines 2018’s “Global Disappointment” Amid The Change From Cheer to Fear
• Seth Klarman Blats Of “Unbiased Regulation” In Trump Administration Without Providing Much Detail

Is the tide finally rolling out?

In his recent investor letter, Baupost CEO Seth Klarman described the fourth quarter as a “tide market,” a term coined by retired Baupost Partner Brian Spector. Whenever the tide goes out, it takes everything with it, and that’s pretty much what happened during the fourth quarter.