This week, I tried something different for our #askdrwealth series. We explored the Magic Formula and explore a free tool that allows us to screen for Magic Formula stocks.
You can read on for my summary, or watch the full session here:
The “Magic Formula” sounds like a hyped up, get rich quick concept. But, it’s actually a legit (and relatively famous) value investing strategy devised by Joel Greenblatt.
Who is Joel Greenblatt?
A hedge fund manager and adjunct professor at Colombia Business School, Joel Greenblatt runs Gotham Funds, an equity management firm.
Although he isn’t as famous as Warren Buffett or Ray Dalio, Joel Greenblatt is one of the forerunners in modern value investing.
He first introduced the Magic Formula in his book, The Little Book that Beats the Market.
What is the Magic Formula?
In a nutshell, the Magic Formula is about buying good companies at bargain prices....