Long back I read the book by Joel Greenblatt. This book certainly is a very sensible read. Joel Greenblatt is a successful investor and he talks about a "Magic Formula" which is a rank based selection of stocks from a wide range of stocks.
The two main aspects of the selection criteria are based on the "ROCE (Return on Capital Employed)" and "Earnings Yield (EPS/Price)". This Greenblatt says indicates that we buy good businesses available at "bargain" prices.
This is a good read for Investors who want to understand "Fundamental Analysis"/ "Value Investing".
Joel Greenblatt is the founder of Gotham Capital. Interestingly, he is referenced in Michael Lewis's recent book "The Big Short" where Greenblatt is potrayed as a greedy guy with his differences with Dr. Burry of Scion Capital who is one of the unsaid heroes of the book "The Big Short".
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