If you spend your energies looking for and analysing situations not closely followed by other informed investors, your chance of finding bargains greatly increases.
Joel GreenblattLook down, not up, when making your initial investment decision. If you donโt lose money, most of the remaining alternatives are good ones.
Joel GreenblattThe big picture is: the main thing you should be concerned about in the future are incremental returns on capital going forward. As it turns out, past history of a good return on capital is a good proxy for this but obviously not foolproof. I think this is an area where thoughtful analysis can add value to any simple ranking/screening strategy such as the magic formula. When doing in depth analysis of companies, I care very much about long term earnings power, not necessarily so much about the volatility of that earnings power but about my certainty of "normal" earnings power over time.
Joel GreenblattThe more confidence I have in each one of my stock picks, the fewer companies I need to own in my portfolio to feel comfortable.
Joel GreenblattI 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 Greenblatt