A great little book to read, for some laughs, The Little Book that Still Beats The Market has been lauded as a much needed back to basics for me. See my review here.
Lest we state the obvious, the book in one sentence is "Buying good businesses at bargain prices is the secret to making lots of money."
Greenblatt, the author, goes on to explain in about 100 pages what is a good business, and how to recognise what do bargain prices look like, with 2 metrics - earnings yield (trailing EBIT / Enterprise Value) and return on invested capital (trailing EBIT / (Net Working Capital + Net Fixed Assets)).
No comments:
Post a Comment