The Little Book That Still Beats the Market: 29 (Little Books. Big Profits) Hardcover – 24 Sept. 2010

I first read this six years ago and I've re-read it roughly one a year since. In my view this is an investment classic. His target audience is his teenage children, and he's a wickedly funny writer - so the book is an easy read. For a technical book, that's quite an achievement.He starts out by explaining the basics of safe investing - banks accounts and government bonds. Then he moves into riskier investing in businesses via the stock market. He gives a great explanation of how a business works, via the fictional "Jason's Gum Shops" and "Just Broccoli". While doing that, he explains what the key fundamental data means e.g. sales, cost of sales, earnings, income. We're eased into the technicalities by reading the story.Ben Graham's "Mr Market" and "margin of safety" then make an appearance, placing Greenblatt firmly in the value investing camp. But he explains that value investing isn't easy, and you're up against finance professionals.He's come up with a "Magic Formula" for us to use. It's been heavily and successfully back tested. Yet in concept it's very simple:a) Find the earnings yield of companies, and sort them from highest to lowest. Give the best score of 1, the next a score of 2, and so on. This searches for the best bargains.b) Find the return on assets for the same companies, and create a new list sorted by ROA. Again, give them scores, 1 for the best, etc. This searches for great companies.c) Add these two numbers together to get the company's magic formula score. This gives great companies at relatively cheap prices.d) Buy the top 30 companies. This creates a portfolio, to minimise risk.e) Sell them after 12 months, and repeat.I forward tested it back in 2010, reviewing the results a year later. Some companies did badly, some extraordinarily well - as Greenblatt predicted. The key was the portfolio did well. It did slightly better than the S&P 500. I noticed that some of the performance was driven by two or three companies which were taken over. I've repeated the exercise in following years, when it also did well.It's easy to find US companies which fit the bill - he shows you on his website. For UK stocks, you can get them via the "ShareScope" app.If you're into value investing, you should take a look at this book. If you want your children to understand the stock market and invest for their future, you can't go wrong with this.

Even you can invest without emotions and come out on top? Well not quite but close, this book gives you the tools to start as a Quant(rule based) investor but it will be up to you how you implement it. It is written for the rest of us and an easy read.

I found the book an interesting and enjoyable read. He has managed to make what on the face of it can be a very dry and vanilla subject matter, for the non-aficionado's, into a humorous and also very useful read and has managed to condense that into about 180 odd pages. Its very good value and can be read in an afternoon.

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.

Interesting idea in book, but unfortunately it doesn't seem to work now.

Great book, easy to read and packed with information that will already enhance your investment skills.

It does beat the market of that I have no doubt but where it falls at the first hurdle for me at age 63 is time. I simply do not have enough time for the strategy to work or the nerves to watch my stocks fall and hopefully rise again. By the time the market wakes up to the value in the stocks it recommends I might be dead. A brilliant book which is well worth the read. If you are on the last leg like myself you could do a lot worse than order Stan Weinsteins book at the same time. I have no doubt that if I had bought this book twenty years ago I would be a very happy and wealthy man now.

Very good and easy read book to help understand how the stock market works (or doesn't at times) and why the only way to make money is to do the research on possible company stocks