Entrepreneurs / Investors

35 Joel Greenblatt Quotes on Success (INVESTMENT)

Top 10 Most Famous Joel Greenblatt Quotes (BEST)

“The 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 Greenblatt
Remember, it’s the quality of your ideas not the quantity that will result in the big money.
Remember, it’s the quality of your ideas not the quantity that will result in the big money.

“Here 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 Greenblatt
If you spend your energies looking for and analyzing situations not closely followed by other informed investors, your chance of finding bargains greatly increases.
If you spend your energies looking for and analyzing situations not closely followed by other informed investors, your chance of finding bargains greatly increases.

“My 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 Greenblatt
Even after you learn where to look for new ideas, the notion that you can cover even one-tenth of these special corporate events is a pipe dream.
Even after you learn where to look for new ideas, the notion that you can cover even one-tenth of these special corporate events is a pipe dream.

“I 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 Greenblatt
If I plug my estimates into the Magic Formula, and it comes out cheap, that's good.
If I plug my estimates into the Magic Formula, and it comes out cheap, that’s good.
We are busy surviving, herding, fixating on what just happened, and being overconfident!
We are busy surviving, herding, fixating on what just happened, and being overconfident!
I don't know too many people that are good at timing the market relative to macro-economic events.
I don’t know too many people that are good at timing the market relative to macro-economic events.

7 Motivational Joel Greenblatt Quotes for a Successful Investment

“There’s a virtuous cycle when people have to defend challenges to their ideas. Any gaps in thinking or analysis become clear pretty quickly when smart people ask good, logical questions. You can’t be a good value investor without being an independent thinker – you’re seeing valuations that the market is not appreciating. But it’s critical that you understand why the market isn’t seeing the value you do. The back and forth that goes on in the investment process helps you get at that.”

Joel Greenblatt
The secret to investing is to figure out the value of something - and then pay a lot less.
The secret to investing is to figure out the value of something – and then pay a lot less.

“After more than 25 years of investing professionally and after 9 years of teaching at an Ivy League business school, I am convinced of at least two things: 1. If you really want to “beat the market,” most professionals and academics can’t help you, and 2. That leaves only one real alternative: You must do it yourself.”

Joel Greenblatt
I wait until an investment idea is so good, it hits me over the head like an anvil.
I wait until an investment idea is so good, it hits me over the head like an anvil.

“It just seems logical that sticking to investing in only a small number of companies that you understand well, rather than moving down the list to your thirtieth or fiftieth favorite pick, would create a much greater potential to earn above-average investment returns.”

Joel Greenblatt

“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 Greenblatt

“In short, companies that achieve a high return on capital are likely to have a special advantage of some kind. That special advantage keeps competitors from destroying the ability to earn above-average profits.”

Joel Greenblatt

3 Joel Greenblatt Quotes on Business

“There’s a clarity that comes with great ideas: You can [easily and simply] explain why something’s a great business, how and why it’s cheap, why it’s cheap for temporary reasons and how, on a normal basis, it should be trading at a much higher level. You’re never sitting there on the 40th page of your spreadsheet, as Buffett would say, agonizing over whether you should buy or not.”

Joel Greenblatt

“Something 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 gamut—spinoffs, mergers, restructurings, rights offerings, bankruptcies, liquidations, asset sales, distributions.”

Joel Greenblatt

“Of course, there are plenty of ways we could define what makes a business either good or bad. Among other things, we could look at the quality of its products or services, the loyalty of its customers, the value of its brands, the efficiency of its operations, the talent of its management, the strength of its competitors, or the long-term prospects of its business.”

Joel Greenblatt

2 Joel Greenblatt Quotes on Risks

“So one way to create an attractive risk/reward situation is to limit downside risk severely by investing in situations that have a large margin of safety. The upside, while still difficult to quantify, will usually take care of itself. In other words, look down, not up, when making your initial investment decision. If you don’t lose money, most of the remaining alternatives are good ones.”

Joel Greenblatt

“When thinking about risk, rather than making things unnecessarily complicated, there are really two main things you should want to know about an investment strategy: 1. What is the risk of losing money following that strategy over the long term? 2. What is the risk that your chosen strategy will perform worse than alternative strategies over the long term?”

Joel Greenblatt

7 Joel Greenblatt Quotes on Stocks

“Over the long term, despite significant drops from time to time, stocks (especially an intelligently selected stock portfolio) will be one of your best investment options. The trick is to GET to the long term. Think in terms of 5 years, 10 years and longer. Do your planning and asset allocation ahead of time. Choose a portion of your assets to invest in the stock market – and stick with it! Yes, the bad times will come, but over the truly long term, the good times will win out – and I hope the lessons from 2008 will help get you there to enjoy them.”

Joel Greenblatt
The more confidence I have in each one of my stock picks, the fewer companies I need to own in my portfolio to feel comfortable.
The more confidence I have in each one of my stock picks, the fewer companies I need to own in my portfolio to feel comfortable.

“Maintaining a three- to five-year horizon for your stock market investments should give you a large advantage over most investors. It is also the minimum time frame for any meaningful comparison of the risks and results of alternative investment strategies.”

Joel Greenblatt
Choosing individual stocks without any idea of what you're looking for is like running through a dynamite factory with a burning match. You may live, but you're still an idiot.
Choosing individual stocks without any idea of what you’re looking for is like running through a dynamite factory with a burning match. You may live, but you’re still an idiot.

“Perhaps, since the measurement of potential gain and loss from a particular stock is so subjective, it is easier, if you are a professional or academic, to use a concept like volatility as a substitute or a replacement for risk than to use some other measure. Whatever the reason for everyone else’s general abdication of common sense, your job remains to quantify, by some measure, a stock’s upside and downside. This is such an imprecise and difficult task, though, that a proxy of your own may well be in order.”

Joel Greenblatt
The way we make money as a group is that we don't pay a lot for anything, and most of the stocks we buy have low expectations.
The way we make money as a group is that we don’t pay a lot for anything, and most of the stocks we buy have low expectations.
The strategy of putting all your eggs in one basket and watching that basket is less risky than you might think.
The strategy of putting all your eggs in one basket and watching that basket is less risky than you might think.

2 Joel Greenblatt Quotes on Value Investing

“Value investing doesn’t always work. The market doesn’t always agree with you. Over time, value is roughly the way the market prices stocks, but over the short term, which sometimes can be as long as two or three years, there are periods when it doesn’t work. And that is a very good thing. The fact that our value approach doesn’t work over periods of time is precisely the reason why it continues to work over the long term.”

Joel Greenblatt

“Value investing strategies have worked for years and everyone’s known about them. They continue to work because it’s hard for people to do, for two main reasons. First, the companies that show up on the screens can be scary and not doing so well, so people find them difficult to buy. Second, there can be one-, two- or three-year periods when a strategy like this doesn’t work. Most people aren’t capable of sticking it out through that.”

Joel Greenblatt

4 Joel Greenblatt Quotes About the Market

“Stock prices move around wildly over very short periods of time. This does not mean that the values of the underlying companies have changed very much during that same period. In effect, the stock market acts very much like a crazy guy named Mr. Market.”

Joel Greenblatt
Although over the short term Mr. Market may price stocks based on emotion, over the long term Mr. Market prices stocks based on their value.
Although over the short term Mr. Market may price stocks based on emotion, over the long term Mr. Market prices stocks based on their value.

“If you just stick to buying good companies (ones that have a high return on capital) and to buying those companies only at bargain prices (at prices that give you a high earnings yield), you can end up systematically buying many of the good companies that crazy Mr. Market has decided to literally give away.”

Joel Greenblatt

Graham figured that always using the margin of safety principle when deciding whether to purchase shares of a business from a crazy partner like Mr. Market was the secret to making safe and reliable investment profits.”

Joel Greenblatt

(MUST READ) You Can Be a Stock Market Genius: Uncover the Secret Hiding Places of Stock Market

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