Is there a magic formula for making money from investing?

While no stock-picking method is perfect, Joel Greenblatt's 'magic formula' is better than most. Phil Oakley explains how it works.

We'd all love to find a foolproof investing method that makes money in both good times and bad. Sadly, it doesn't exist. But some methods make more sense and have a better track record than others. One such method is Joel Greenblatt's so-called magic formula: buying good-quality businesses at cheap prices.

How does it work?

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Phil spent 13 years as an investment analyst for both stockbroking and fund management companies.

 

After graduating with a MSc in International Banking, Economics & Finance from Liverpool Business School in 1996, Phil went to work for BWD Rensburg, a Liverpool based investment manager. In 2001, he joined ABN AMRO as a transport analyst. After a brief spell as a food retail analyst, he spent five years with ABN's very successful UK Smaller Companies team where he covered engineering, transport and support services stocks.

 

In 2007, Phil joined Halbis Capital Management as a European equities analyst. He began writing for MoneyWeek in 2010.