Joel Greenblatt best investing strategy

Many famous traders have become rich simply because of their abilities, without having any education in finance or economics.

But this does not mean that having an education interferes with success; rather, on the contrary, it helps to find the right decisions when making investments.

It is good economists who achieve success when investing, using approaches that are different from speculative ones and at the same time have less risk.

An excellent example of how a good education helps in the workplace is Joel Greenblatt, who graduated from the University of Pennsylvania Business School in 1980.

At that time he was 23 years old. And five years later he founded his own hedge fund called “Gotham Capital” with a capital of $7 billion.

A distinctive feature of this fund was its profitability; thanks to Joel’s strategy, the company was able to operate for 9 years with an average annual profitability of 50% per annum.

What is the secret of Joel Greenblatt's strategy?

As he himself states, he managed to develop the “Magic Cost of Investing”, the main components of which are:

• Buy inexpensive shares of promising companies that show profits.

• The market value of the acquired companies must exceed $50 million.

• When investing, choose only low-risk properties.

• Diversification of investments should not be excessive.

• Use special situations for purchases - acquisitions, mergers, restructuring.

• Always consider what level of profit the stock has in relation to the invested capital.

When choosing a security, try to turn off your emotions and focus only on numbers and industry forecasts; only this approach will allow you to achieve outstanding results.

To study the strategy in more detail, read Joel Greenblatt’s book “The Little Book of the Stock Market Winner” - http://time-forex.com/knigi/malenkaya-kniga