5' - The Little Book That Still Beats the Market

This text is an excerpt from Joel Greenblatt's book, "The Little Book That Still Beats the Market," which presents a "magic formula" investment strategy. The excerpt includes the book's table of contents and selections from several chapters. These chapters explain the formula, which ranks companies based on earnings yield and return on capital, suggesting that buying good companies at bargain prices leads to strong returns. The author also addresses potential challenges of this strategy, including short-term underperformance and the need for long-term belief in the system. Finally, it examines the limitations of other common investment approaches.