📖Joel Greenblatt
Multidisciplinary Thinking
Use insights from multiple disciplines for better decisions.
Draw insights from multiple disciplines — psychology, history, mathematics, and science — to build a lattice of mental models for better investment decisions.
🏠 Everyday Analogy
📖 Core Interpretation
Joel Greenblatt highlights that many investment mistakes are psychological, not analytical. Managing behavior under stress is as important as finding ideas.
💎 Key Insight：Cross-disciplinary thinking reveals patterns invisible to specialists.
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❓ Why It Matters
In volatile markets, fear and greed push investors to buy high and sell low. A behavioral framework reduces avoidable, self-inflicted errors.
🎯 How to Practice
Pre-write decision rules, slow down trades during stress, and separate market emotion from business facts before adjusting positions.
⚠️ Common Pitfalls
Following crowd emotion at extremes
Mistaking confidence for certainty
Forcing trades to quickly recover losses
📚 Case Studies
1
Best Buy Value Opportunity (2011)
Best Buy’s price fell on fears of Amazon competition, pushing its earnings yield high relative to normalized profits and free cash flow.
✨ Outcome：Investors buying on elevated earnings yield saw strong recovery as buybacks, cost cuts, and stable demand lifted the stock in subsequent years.
2
American Express Spin-Off Opportunity (2004)
Greenblatt analyzed American Express when it was temporarily out of favor, trading below its intrinsic value based on earnings and returns on capital.
✨ Outcome：Invested at depressed prices, earning strong returns as earnings normalized and the market rerated the stock.
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