Joel Greenblatt

Joel Greenblatt On Value Investing

In New York, at the fifth annual value investing congress, specialists from all around the world gather there to talk about investment ideas and strategies. One of the kings of value investing, Joel Greenblatt, is also there. The host of the show is curious to know where to look for value now. He tells that if a company can earn fifty percent of its capital instead of thirty two percents of its capital, that is a good company. What he talked about at the congress was just doing a ranking of stocks based on how could they return capital and how can you buy them at a cheap price.

Joel Greenblatt On The Origins of the Magic Formula

Joel Greenblatt started with value investing in the end of the seventy years, he wrote an article in Forbes about Benjamin Graham. The article was about what he considered some kind of magic formula, what he caught his eyes. It was like a formula, if you just buy stocks that meets some particular specifics, you can make a lot of money. He was a college student then, and a formula of making money was very interesting for him. He was concerned then to see what is that all about.

Joel Greenblatt on the Magic Formula of Value Investing

Joel Greenblatt made his name in value investing. He is a professor at Columbia business school and the author of the New York Times best seller, the little book that beats the market. If someone follows what was written in that book, about the value investing magic formula, that someone would be doing much better. The host asks him what is the secret laid out in that book. He says that the secret is very simple, it is really basic value investing. They are looking for cheap companies, at last year's earnings.

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