I still believe that for good business analysts a concentrated portfolio is a good strategy combined with a long term horizon. Once again, the secret to success in following the formula strategy is patience, a quality in short supply for both professionals and individual investors alike. I think investors should have a large portion of their assets in equities over time.
Joel GreenblattMy goal is to buy a company at a low multiple to normal earnings power several years out and that the company earns good returns on capital at that level of normal earnings. A holding period of more than one year also works quite well as the factors are persistent in years 2 and 3.
Joel GreenblattI think the exercise of trying to figure out how to simplify concepts has been incredibly helpful to me over the last 13 years of teaching and I hope my students have benefited from it.
Joel GreenblattWe are busy surviving, herding, fixating on what just happened, and being overconfident!
Joel GreenblattHere is part of the tradeoff with diversification. You must be diversified enough to survive bad times or bad luck so that skill and good process can have the chance to pay off over the long term.
Joel GreenblattIf you spend your energies looking for and analysing situations not closely followed by other informed investors, your chance of finding bargains greatly increases.
Joel GreenblattSomething out of the ordinary course of business is taking place that creates an investment opportunity. The list of corporate events that can result in big profits for you runs the gamutโspinoffs, mergers, restructurings, rights offerings, bankruptcies, liquidations, asset sales, distributions.
Joel Greenblatt