by Joel Greenblatt
Joel Greenblatt’s The Little Book That Still Beats the Market introduces a straightforward yet powerful strategy known as the “Magic Formula.”
Designed for investors of all levels, Greenblatt’s formula combines two key metrics: a company’s earnings yield and its return on capital. By focusing on stocks that are both profitable and undervalued, this formula helps identify investment opportunities with high potential returns.
Greenblatt presents his approach in simple, engaging language, making complex investing principles accessible.
He emphasizes the importance of buying quality companies at attractive prices, encouraging readers to invest with patience and discipline.
Although the Magic Formula doesn’t guarantee success in the short term, Greenblatt argues that it can produce substantial gains over time. The book also highlights the psychology of investing, discussing how to stay rational in a market driven by fear and greed.
This practical guide equips readers with a solid framework for long-term investing, providing a structured yet flexible strategy for identifying winning stocks.