The Little Book That Still Beats the Market

This book was fun to read, since the author has a good sense of humor. It is well explained and clear step by step guide is provided.

At 80, I have just discovered this book and enjoyed it more than any other book I've read (well, at least more than any book I REMEMBER reading). The book starts slow, as if to disguise how good it really is. By chapter 6 I was laughing out loud, at the statistical simplicity, shear elegance, and ironic effectiveness of this investment approach. I've a masters in general experimental psychology and have taught graduate level statistics, so I have some background from which to reasonably allege that this is a great book. Don't miss it. Don't let the negative reviews dissuade you. This is a sincere book written by an obvious expert who has the humility to acknowledge the well established fact that most investment advisors can't beat the market. He's come up with a simple method that works, tested it, and is sharing it. You probably won't do better than this. Yet of course you probably will think you can. Which is what makes this so much fun. Is it statistics, investing advice, psychology, or zen? Just read it - and if you do, don't miss the depth that's disguised with simplicity. Don't miss the irony of a guy who wrote this to explain why you probably can't do any better than this who then spends his career managing investment funds. And writing more books. If you don't think THAT is humor, rate yourself dull normal at best! Enjoy. If you don't enjoy this book, feel free to write a scathing review of this review!

Ok so two things need to be taken into consideration prior to reading this review. 1. I've been a customer on Amazon (and customer of many retail stores) for many years now and purchased over 100's (probably thousands) of items, many in which I love! And have never ever felt the need to leave a review for. 2. If I think this book is so amazing why haven't I given it 5 stars, why not 4? Well for starters I'm a novice investor. By novice I mean 2 months worth of experience in the actual stock market lol not including 2 year's of investing in the acorns app (which after fees I walked out with an extra $50). While that might seem like a horrible investment please keep in mind I had a little over $700 in the account, so about a 7% return and acorns is a mobile app. Some how I knew I could do much better than that investing in the stock market myself. It was always something I've been interested in for year's now. However like most people, the idea of losing all my hard earned money has put a damper into that interest. But after seeing the possible returns I could make I told myself investing in it myself could be even more rewarding in the end. So I'm assuming like everyone who purchased this book, I wanted to start gaining knowledge about the stock market. So I purchased a few books. One being a investing 101 book written by a CPA. Then I went ahead and researched the greatest books on investing and came across Benjamin Graham's book "The intelligent investor" which I purchased. Bought myself a book to teach me on how to read a balance sheet and other financial statements so that I'd be able to learn how to read a companies health. With the thirst for more knowledge I kept picking up more books which brings me to this one "The little book that still beats the stock market" and i love it so much that after year's of never reviewing anything I felt the need to actually write a review. But the author of this book truly simplified everything I've read up until this part. That's why it's so important you understand that I'm still a novice investor, someone with only 2 months of experience in the stock market on my own. This author not only wrote this book as if he were talking to adults, but also as if he was talking to his children. So he literally wrote this in a way that most if not all people could truly understand. And with the knowledge I had gained from those other books I've read in the past (but was somewhat confused by because of the literature and lack of experience or knowledge in investing) this book truly clarified everything and put it in a wider perspective that I could actually grasp hitting on every key thing the other books had mentioned (even referencing the greatest book in investing by Benjamin Graham) already in a more simplified and fun way. I say fun because apparently this author is a comedian literally joking his way throughout the entire book keeping me entertained and never losing focus of actually learning what he's teaching. I'm really impressed by this book because as a beginner in investing I feel that this book along with everything I've learned with the others had given me the courage and understanding to know what to look for and how to look for them when it comes to stocks or index funds and even bonds. Now on to the reason why I gave it 4 stars and not 5. I consider myself a realist and throughout the entire book the author mentions this system in which he calls the "magic formula" which picks out the greatest stocks at under value Price's. I've yet to try his formula and therefore can't give it 5 stars, but I definitely will and believe that how he goes about making this formula puts Warren Buffett's and his mentor Benjamin Graham's formula in a more simplified way for everyone to understand even those who don't have a bachelor's degree.

This book contains a tested systematic approach to stock market investing that most people can implement on their own.As I write this review, there are already 266 reviews of Joel Greenblatt's "The Little Book..." on Amazon. Why bother? One reason is that since first published in 2005, Greenblatt's investment accomplishments have become even more widely appreciated, giving added credibility to his advice. For example, he is featured as one of the "Hedge Fund Market Wizards" in Jack Schwager's recently published book of the same name Hedge Fund Market Wizards (please see my review of that book). Additionally, at present returns on traditional savings accounts are very close to zero and the US Treasury Note yields a mere 1.7 percent. Any of us who envisioned living in retirement from the interest on our savings were sadly mistaken. Greenblatt's investment system as presented in this book may be one of very few, or the only, approach that is likely to generate low-risk investment results that might really help savers and seniors meet their previous expectations.The writing style is clear and simple. The author explains investment terms like return on capital and earnings yield in a conversational tone without condescention. He uses a couple of example fantasy businesses in an entertaining manner to illustrate the concepts. As the book progresses, he uses these basic examples as the foundation for more advanced concepts (not complex, but necessary). Necessary for what? For the reader to believe in the investment system that Greenblatt presents in the book to a degree that the reader will stick to the system without variance for a period of years in order to enjoy the benefits that accrue to long-term investors (think Buffett, Rogers, Graham, Bogle, Templeton).I urge you to read the book review by "Value Investor" on these pages. He lays out the reasons why this system is very likely to perform well over a period of years. In a nutshell, it is likely to work because the author has done extensive testing of the system, uses it as the basis for his own hedge fund's portfolio management, and because it takes considerable patience and fortitude to follow (traits not found in excess on Wall Street).One aspect that I really appreciate is the author's willingness to concede that many investors want a higher degree of involvement in selecting the stocks for their portfolios. They may be uncomfortable following a more mechanical system. He addresses this issue by giving clear guidance on how one may still follow the system even with the addition of an element of personal discretion, depending on the investor's level of expertise, time commitment and available capital.Finally, the author maintains a free website (now for 7+ years) to aid investors with portfolio selection. This is a high value service in my opinion.I highly recommend this book to any saver or investor, or speculator or trader for that matter, who wishes to increase their returns on investment and improve their overall portfolio performance. Five stars.