The new funds are based on Greenblatt’s so-called Magic Formula, a common-sense approach to value investing that ranks stocks on price and yield and recommends buying and holding a basket of cheap companies that have been overlooked or are under-appreciated by investors. (Greenblatt outlined the philosophy in his 2005 book, The Little Book That Beats the Market.) Greenblatt and his 16-person investment staff have been working to create a slate of value strategies, both long-only and long-short funds, which both build on and enhance his value-investing formula.
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