Features
- Cover Type: Hard Cover with 176 pages
- Published by: Wiley November 19, 2005
- Written in: English
- ISBN 10 Number: 0471733067
- ISBN 13 Number: 978-0471733065
-
Book Dimensions:
7.1 x 5.4 x 0.9 inches
- Weighs: 8.8 ounces
From Publishers Weekly
Contrary to efficient-market naysayers, this engaging investment primer contends that ordinary stock-market investors can indeed get better-than-market returns over the long haul. Greenblatt (
You Can Be a Stock Market Genius), a Columbia Business School adjunct professor, touts a "value-oriented" approach that looks for bargain stocks whose share price is cheap relative to the company's profitability. His version is a "magic formula" that ranks stocks on the basis of two variables—the earnings yield and the business's return on capital. His Web site, magicformulainvesting.com, virtually automates the procedure for novices. Greenblatt offers lots of statistical proof of the formula's success, but emphasizes the importance of faith in seeing the investor through inevitable short-term downturns: "It will be your belief in the overwhelming logic of the magic formula that will make the formula work for you in the long run." He conveys his ideas through a lucid if rudimentary and rather corny explanation of basic investment concepts about risk, return, interest and business valuation. Although the magnificent returns he touts seem too good to be true, Greenblatt's formula is a reasonable variant of mainstream value-investing methods. Investors seeking a little more hands-on excitement than the average mutual fund offers will not go too far wrong following his advice.
(Jan.) Copyright © Reed Business Information, a division of Reed Elsevier Inc. All rights reserved.
From AudioFile
A Wharton-trained head of a successful investment partnership has a foolproof method for evaluating stocks: Companies are worth what they return to investors on a consistent basis. Trusting yourself to use this simple principle will work much better than any get-rich schemes, and much better than trusting other people to select stocks for you. The method requires some digging into a stock's fundamentals, understanding risk factors, and paying close attention to timing when buying and selling. An enhanced CD contains printable details of the author's "magic formula" for evaluating stocks. Adam Grupper does well with this material, projecting confidence and using vocal tones and pacing that are enjoyable for the entire program. T.W. © AudioFile 2006, Portland, Maine--
Copyright © AudioFile, Portland, Maine
--This text refers to the
Audio CD
edition.
Reader Reviews
What do you get when you mix a strong marketing plan, a well known and successful hedge fund manager, and 100 pages of investing platitudes? Answer: Greenblatt's new book. I hate to be so harsh on the book, because I think Greenblatt's intentions are good. So let me correct myself: If you are under the age of 12 and know diddley squat about how stocks work, buy this book. You'll learn a lot. Now, if you have even a rudimentary knowledge of stock picking -- save your money. Greenblatt says two important things in this book then repeats himself for 100 + pages. All you need to know you could have gotten for free at Morningstar: buy companies with high ROC (return on assets or "ROA") and high earnings yield (inverse of P/E ratio -- the E/P ratio).
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