How He Managed to Earn 40% Returns | Joel Greenblatt | Stocks | Investment

Joel Greenblatt explains how he managed to generate nearly 40% annual returns by running a highly concentrated investment portfolio. In this video, we explore how Joel Greenblatt focused on a small number of high-conviction ideas instead of diversifying across dozens of average stocks. His approach was rooted in value investing, where buying great businesses at attractive prices mattered more than short-term market movements. Greenblatt relied on earnings yield and return on invested capital to identify companies with strong fundamentals and undervalued prices. This combination helped him reduce downside risk while maximizing long-term upside potential. He believed concentration works best when investors truly understand the businesses they own. Rather than reacting to market noise, he stayed patient and allowed compounding to work over time. The video also explains why frequent trading often hurts returns for most investors. By sticking to a disciplined value investing framework, Greenblatt consistently outperformed the broader market. His strategy later became widely known through the Magic Formula investing approach. Watch this video to understand why value investing and portfolio concentration played a key role in Joel Greenblatt’s remarkable success. 00:00 - Intro 00:30 - What is the Secret? (40% returns) 01:41 - Concentrated Portfolio? 06:26 - Earnings Yield better than ROIC? Watch our other video here:    • Super Investors   Connect with us here as well: https://www.facebook.com/TheFinancialEcono... https://www.instagram.com/the_financial_ec... Applications & Software used: VSDC Video editor Pexels for Stock videos - https://www.pexels.com/videos/ Business enquiries - [email protected] #joelgreenblatt #stocks #stockmarket #investment #multibaggerstock #magicformula #investmentstrategy #investing #thefe #compounding