Customer Reviews


18 Reviews
5 star:
 (10)
4 star:    (0)
3 star:
 (3)
2 star:
 (2)
1 star:
 (3)
 
 
 
 
 
Average Customer Review
Share your thoughts with other customers
Create your own review
 
 

The most helpful favourable review
The most helpful critical review


5 of 6 people found the following review helpful
5.0 out of 5 stars Invaluable...despite the somewhat odd style for a book on investing
The Little Book that Beats the Market was quite an unexpected read, to say the least. On one hand I can see the benefits of its humorous, simple, story-telling style for those who are new to investing, financial markets, company reports etc. On the other hand, for somewhat more sophisticated and experienced investors, Greenblatt's writing style may be a bit off-putting...
Published on 6 Nov 2009 by pg33

versus
171 of 174 people found the following review helpful
3.0 out of 5 stars A New Way to Buy Low and Sell Annually
Ever since computer databases have become more available and computing time and memory have been cheap, anyone can take investment history and devise a "back-tested" solution that would have made you a fortune.
I don't recall any version of such a scheme that ever held up for long when it was then used to make investments going forward. Why? Conditions...
Published on 12 Jan 2006 by Donald Mitchell


‹ Previous | 1 2 | Next ›
Most Helpful First | Newest First

171 of 174 people found the following review helpful
3.0 out of 5 stars A New Way to Buy Low and Sell Annually, 12 Jan 2006
By 
Donald Mitchell "Jesus Loves You!" (Thanks for Providing My Reviews over 124,000 Helpful Votes Globally) - See all my reviews
(HALL OF FAME REVIEWER)    (TOP 500 REVIEWER)    (VINE VOICE)   
Ever since computer databases have become more available and computing time and memory have been cheap, anyone can take investment history and devise a "back-tested" solution that would have made you a fortune.
I don't recall any version of such a scheme that ever held up for long when it was then used to make investments going forward. Why? Conditions change.
Mr. Greenblatt's approach uses a 17 year history during one of the strongest bull markets in American investing history to come up with his approach. Will this approach work during a flat or declining market? Who knows?
Mr. Greenblatt argues (unpersuasively to my mind) that his approach will continue to work because the method fails to work very consistently over periods of less than three years. That will discourage anyone from using it for very long.
The approach is summarized on pages 134 and 135. Basically, you go to his Web site and use the data there to pick companies with a low price relative to buy 20-30 stocks over the next year (a few every 3 months). You sell each one a day or so after a year has passed (to get capital gains treatment), and replace it with another stock. You pick a minimum size market cap (he suggests at least $50 million), and you select from among the stocks for companies which traded at the lowest multiple of EBIT (earnings before interest and taxes) which had the highest ration of EBIT to the sum of net working capital plus net fixed assets in the prior 12 months. The Web site does this for you now for free.
Here is another practical problem with the book. You need to have quite a lot of money to start with or trading fees will eat up your capital. Let's say you have $10,000 to start. You will be making 60 trades a year to buy and sell 30 stocks. Assuming you pay on-line commission rates of $10 a trade, that's $600 gone to start. If you pay more for trading the problem is worse. So to be efficient, you will probably have to be able to commit at least $25,000. More is better.
I would have been more impressed if the approach (which is a variation on value investing) had included a search for global value. The U.S. stock market is much more expensive now than many other markets. A bargain in an over-priced market may not be such a bargain after all.
Mr. Greenblatt does have a nice way of explaining his ideas. Any teenager could follow this book. I suggest that the book's best use is in introducing teenagers to the idea that Mr. Market is way too volatile in setting "correct" prices, and you can take advantage of that by buying low. Then hand your teenager a copy of The Intelligent Investor by Benjamin Graham to understand how you can find bargains. If that approach seems too complex for your teenager, provide next a copy of John Bogle's Commonsense on Mutual Funds.
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


5 of 6 people found the following review helpful
5.0 out of 5 stars Invaluable...despite the somewhat odd style for a book on investing, 6 Nov 2009
By 
pg33 (London, UK) - See all my reviews
The Little Book that Beats the Market was quite an unexpected read, to say the least. On one hand I can see the benefits of its humorous, simple, story-telling style for those who are new to investing, financial markets, company reports etc. On the other hand, for somewhat more sophisticated and experienced investors, Greenblatt's writing style may be a bit off-putting and misplaced, so understand that the chief purpose of the book is to make a complex matter simple and enjoyable for laymen. However, no matter how experienced an investor you are, you would be well advised to look closely at Greenblatt's proposed strategy, which is not just simple but also very sound. (Simplicity in this case is a true bonus. A simple strategy that works is superior than a complex one, in my book.)

I have been a value investor for a few years now and do my own stock picking (US markets), so while I'm about to build a separate portfolio based on Greenblatt's method, I will still analyse each of the top 50 or so stocks, boiling it down to the best 20-odd. The major difference compared to my past/current strategy is that Greenblatt proposes selling & replacing the stocks annually. While it is true that investors need to take into account commissions (and tax) in this case, commissions (using low cost online brokers) should not amount to more than 1-2% p.a. on a decent size investment, and that is well within acceptable cost limits, in my opinion.

Even if you are not planning to use Greenblatt's method (or indeed any value investing strategy), you will still benefit from reading this short book, and learn a thing or two about the markets, which can only be a good thing.
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


5 of 6 people found the following review helpful
5.0 out of 5 stars good stocks cheaply, 7 Jun 2010
By 
Adam Smith (Surrey, England) - See all my reviews
(VINE VOICE)   
Verified Purchase(What is this?)
I loved this book. Using a simple screening technique, you can isolate those stocks making good returns on assets, and sort into which are cheap and which expensive. then set up a portfolio, suitably diversified, of the top 30 or 40. this does work, over the past year or so, this has yielded good returns for me personally. It has highlighted a number which were taken over and yielded good profits, and several others had excellent growth in price greater than the market, Not all will be winners, and that's why investing in a number of stocks is recommended. great approach, lovely book, quickly understood, can be applied via a number of websites or via Sharescope in the uk- you need software or some other means to get at the fundamental data.
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


5.0 out of 5 stars Great book - equity investing isn't rocket science, 2 Aug 2014
By 
John (London, UK) - See all my reviews
Verified Purchase(What is this?)
This review is from: The Little Book That Still Beats the Market: Your Safe Haven in Good Times or Bad (Little Books. Big Profits) (Hardcover)
I'm really surprised to see some of the reviews of this book. Maybe I'm biased because I invest with a similar philosophy, but it's a very simple way of looking at stocks. I am a professional investor and this book is on my list to read for new joiners to my team.

Yes, his screening website is only set up for US stocks, but there are websites out there that will allow you to screen UK or other intentional markets. I think some of them even have pre-built "Greenblatt" screens. With a little effort, retail investors can save on fund management fees and have a go themselves.

But then as Mr Greenblatt says, the reason why his method works over time is because it doesn't work all of the time. The same probably goes for his method not appealing to all investors, as per the other reviews.
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


3 of 4 people found the following review helpful
5.0 out of 5 stars Very Good Investing Book, 15 Nov 2009
By 
Mariusz Skonieczny "Author" (classicvalueinvestors com) - See all my reviews
(REAL NAME)   
I am a great fan of Joel Greenblatt. This book is very simple to understand and for some more advanced investors, it may be too simple. But, I personally like simplicity because I think that people tend to complicate things too much. In investing, no one really needs to run complicated forecasts and models to see whether a stock is trading at a good price. If you need complicated calculations to convince yourself that something is a good deal, then it probably is not. If most of the mutual fund managers followed Mr. Greenblatt's value investing philosophy, they would do much better than average. Mr. Greenblatt did an excellent job simplifying a somewhat complicated subject of investing.

- Mariusz Skonieczny, author of Why Are We So Clueless about the Stock Market? Learn how to invest your money, how to pick stocks, and how to make money in the stock market
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


6 of 8 people found the following review helpful
1.0 out of 5 stars Warning: USA only, 22 Jan 2012
Verified Purchase(What is this?)
This review is from: The Little Book That Still Beats the Market: Your Safe Haven in Good Times or Bad (Little Books. Big Profits) (Hardcover)
Generally good advice.
However to follow the formula you need to be dealing in USA.
He has worked out a sound formula using USA accountancy practices.
UK companies do not list information that way; therefore you're left having to work out a UK version, for our accountancy rules.
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


3.0 out of 5 stars Simple Reading - Simple Idea, 27 Mar 2014
Verified Purchase(What is this?)
This review is from: The Little Book That Still Beats the Market: Your Safe Haven in Good Times or Bad (Little Books. Big Profits) (Hardcover)
It is fun and easy to read. It boils down to one statement "buy profitable and well managed companies (high Return on Capital) at bargain prices (high Earnings Yield)".
It reinforces that idea throughout the book and at the end (annex) it unveils the "magic formula".
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


5.0 out of 5 stars A simple "must be read", 15 Jan 2014
Verified Purchase(What is this?)
This review is from: The Little Book That Still Beats the Market: Your Safe Haven in Good Times or Bad (Little Books. Big Profits) (Hardcover)
So simple, so practical, ...but don't think that because it looks easy its actually easy to do in practice! Requires real discipline, but will provide the rewards.
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


3.0 out of 5 stars Good enough, 28 Aug 2011
This review is from: The Little Book That Still Beats the Market: Your Safe Haven in Good Times or Bad (Little Books. Big Profits) (Hardcover)
Some time equations are the worst way to understand some things. Therefore, I think this is a good book because it explains things simply as a good business, great profit with a few resources, and makes reader think about the true of the business/companies with funny examples for child and with the basis of value investing. The caution message of high risks in the stock market is embedded in the text and that is relly good for begginers.

Of course, don't invest your money if you has this book as unique reading and if the only thing you know about real companies came from academic theory, MBA schools, and you don't know too much about the real ones, avoid this book.
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


5.0 out of 5 stars The little book that helps, 7 April 2011
This review is from: The Little Book That Still Beats the Market: Your Safe Haven in Good Times or Bad (Little Books. Big Profits) (Hardcover)
This book is well written and easy to read and is ideal for somebody is just started out selecting stocks or a good reminder or for the more experienced.
Help other customers find the most helpful reviews 
Was this review helpful to you? Yes No


‹ Previous | 1 2 | Next ›
Most Helpful First | Newest First

This product

Only search this product's reviews