Joel Greenblatt, Loyal Follower of Warren Buffett
08/19/2020
He believes his success comes from reading the classic writings of Warren Buffett and Ben Graham.
His Gotham Index Plus Fund (GINDX) has outperformed 94% of competitors over the past three years.
His advice to you:
- “Well, I can buy a lot of this, not because I think I’m going to make 10x my money, but because in worst case I can lose a dollar or two, and best case I can make five or 10.”
- You always want to make sure that the deck is stacked in your favor. He wouldn’t place an outsize bet on a stock in which he stands to lose a lot and make a little.
- “Look in places where other people are not,” he said. “Anything changing, anything extraordinary, anything off the beaten path, anything small, everything obscure, anything complicated – you name it.
- Try to sniff out the stocks that no one else is paying attention to. You’re much less likely to come across a bargain if you’re looking in the same spots as everyone else.
- Always look out for “special situations,” including merger arbitrage, recapitalizations, and spin-offs.
Look for the low-hanging fruit. “Where I think I look at investing is looking for easy ones.” Buffett calls them ‘1-foot hurdles.’ Why look for 10-foot hurdles where I have to decide what’s going to happen in that industry five years from now? It’s hard enough as it is. If I can’t figure it out, I move on.”
You can do all that, or you can just invest in his Gotham Index Plus Fund or Warren Buffett’s Birkshire Hathoway stock.
