📖Joel Greenblatt
Integrity Above All
Integrity is the most valuable asset.
Reputation takes a lifetime to build and moments to destroy. In investing and in life, integrity is the most valuable asset you can possess.
🏠 Everyday Analogy
📖 Core Interpretation
Joel Greenblatt sees markets as cyclical rather than linear. Understanding cycle position improves risk-taking decisions more than trying to call exact tops and bottoms.
💎 Key Insight：Reputation, once lost, is nearly impossible to rebuild.
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❓ Why It Matters
Ignoring cycles repeats the same mistakes: excessive optimism at peaks and excessive pessimism near troughs. Context matters for position sizing.
🎯 How to Practice
Monitor credit, valuation, earnings, and sentiment signals; reduce aggressiveness in euphoric phases and preserve flexibility in fearful phases.
⚠️ Common Pitfalls
Treating short rebounds as full cycle turns
Extrapolating peak conditions indefinitely
Becoming maximally defensive near valuation troughs
📚 Case Studies
1
Host Marriott / Marriott Spin-off (1988)
Marriott restructured, spinning off its real estate-heavy Host Marriott from its management business. Many investors dumped the more leveraged entity, pushing the price below intrinsic value.
✨ Outcome：Investing in the unpopular spin-off produced strong gains as asset values and earnings power were recognized over time.
2
Coca-Cola’s Simple Business (1988)
Greenblatt highlighted Coke’s dominant brand, straightforward business model, and predictable cash flows as a classic simple investment.
✨ Outcome：Long-term holders earned substantial returns as earnings compounded and the brand expanded globally.
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