The Strategist
The long view, patient, analytical, playing several moves ahead.
Joel Greenblatt exemplifies The Strategist by stripping away surface metrics to locate durable causal logic, grounding valuation in cash flows and business worth rather than factor proxies. His explicit rejection of correlation-driven frameworks in favor of private-equity-style first-principles thinking marks a leader who constructs systematic advantages instead of following consensus.
“And I went around the classroom and collected the three by five cards. Then I said, I'm going to go around the room one more time and ask you in front of everybody else how many jelly beans you think are in the jar and you can keep your guess from your three by five card or you can change your guess. That's completely up to you.”
“Fourteen years. And then in 2009, we started taking outside money again. And it was really, you know, really starts really back when I was in business school, and I had read that article about Benjamin Graham and actually did a study with a couple of my classmates, Rich Pazina, who's a famous money manager now and Bruce Neuberg, who's sti…”
“That were trading way above what we thought they were worth, when we discovered that we could actually make more money having diversified portfolios and that our bad days would be 20 or 30 basis points of underperformance, not 20 or 30 percent down.”
“Still going to cost you roughly the $400,000, but because it's basically a stupid idea just to sell broccoli, maybe only earn $10,000. That's a two and a half percent return on tangible capital. And so all we said was all things being equal much prefer to own the business that can reinvest its money at 50% returns than 2.5% returns.”
Masters in Business: “Joel Greenblatt on Relative Value Investing (Podcast)”
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