Joel Greenblatt
Joel Greenblatt📌 Mental Models

Joel Greenblatt's Mental Models Rules

Joel Greenblatt (born December 13, 1957) is an American investor, hedge fund manager, and author. He is the founder of Gotham Capital, which achieved annualized returns of approximately 40% from 1985 to 2006, and is a professor at Columbia Business School. Greenblatt is best known for developing the "Magic Formula" investing strategy, a systematic approach that ranks stocks based on...

3 principles·Mental Models

3 Key Mental Models Principles

#1

Multidisciplinary Thinking

"Draw insights from multiple disciplines — psychology, history, mathematics, and science — to build a lattice of mental models for better investment decisions."

Use insights from multiple disciplines for better decisions.

🌳 Advanced★★★★★
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#2

Probabilistic Thinking

"Think in probabilities, not certainties. Every investment has a range of possible outcomes. Weight your decisions by the expected value of each scenario."

Think in probabilities, not certainties.

🌳 Advanced★★★★★
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#3

Inversion Thinking

"Instead of asking how to succeed, ask how to avoid failure. Inverting problems often reveals insights that forward thinking misses."

Invert problems to find insights forward thinking misses.

🌿 Intermediate★★★★★
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Frequently Asked Questions

What are Joel Greenblatt's key mental models principles?

Joel Greenblatt has 3 key principles on mental models. The most important one is "Multidisciplinary Thinking" — Draw insights from multiple disciplines — psychology, history, mathematics, and science — to build a lattice of mental models for better investmen...

How does Joel Greenblatt apply mental models in practice?

Joel Greenblatt applies mental models through several key principles including "Multidisciplinary Thinking" and "Probabilistic Thinking". These principles guide practical investment decisions and have been tested across decades of market cycles.

What makes Joel Greenblatt's approach to mental models unique?

Joel Greenblatt's approach to mental models is distinguished by a focus on long-term thinking and fundamental analysis. With 3 specific principles in this area, Joel Greenblatt provides a comprehensive framework that investors at any level can study and apply to improve their decision-making.

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