Sam Zell: Focus On The Downside On A Potential Investment

During his recent interview with Meb Faber, Sam Zell explained why investors should forget the upside and focus on the downside of a potential investment. Here’s an excerpt from the interview:

Zell: I don’t really think a lot has changed on my risk scorecard.

I love to quote Bernard Baruch who as you know survived the depression by selling out before the market crashed.

And his famous quote was – nobody ever went broke making a profit.

In the same manner my focus has always been on the downside. My focus has always been how bad it’s gonna get. What are the variables that might change where I stand.

So I focus on how bad it can get, what I can do to make it better, but always on the downside because if I protected the downside I can survive if the upside gets too good.

You can watch the entire discussion here;