From the Brandes perspective, risk is the permanent loss of capital. In our fundamental analysis of any security, we must consider the question of whether there’s a material risk that the underlying business may become worthless. If so, a high margin of safety may be no protection. As Marks implies, if you can avoid assets that may go to zero, then comparing price to underlying value should help you determine which investments are good, and which are bad. This is different from figuring out which are good and bad businesses.

Source: Memo to Oaktree Clients, September 9, 2015. The margin of safety for any security is the discount of its market price to its estimated intrinsic value.