Assertion Partly supported
Greenblatt: Nikola held a $6.5B valuation despite appearing completely fraudulent
“I was just looking after it's turned out that it appears to be mostly a fraud and they really haven't come up with anything that they promised still has a market cap of six and a half billion.”
Insight
Greenblatt: Being too timid on rare good ideas is investors' biggest mistake
“Position sizing is the most important thing. Being too timid on the few good ideas that come your way is like the biggest mistake people make.”
Disclosure
Greenblatt: Position sizes are determined by downside risk, not upside potential
“The biggest positions I've had are not my best ones. The ones that I think will go up five or 10 times. I'm really looking down, not up when I take a big position. So in other words, I will size the position larger if I don't think I can lose much money.”
Opinion
Greenblatt: US government should lock in 30-year debt while rates are free
“I think our average maturity is like six years. So I think that's insane. I think we should borrow it over 30 years for free. That would be my one suggestion to anyone listening. We should extend our maturities when they're lending us money for free.”
Insight
Greenblatt: Past capital allocation predicts future performance better than executive stories
“And the best rule of thumb that I learned was if this management team was good at allocating capital, before I walked in the door, the assumption that they would continue to be good was a really good assumption. And if they were really bad at it, no matter wha…”
Insight
Greenblatt: Incomprehensible Financial Statements Usually Signal Intentional Obfuscation
“And I just figure if I can't figure it out, they don't want me to figure it out. And I got to go to the next one. I mean, I'll spend a lot of time doing it, but if I can't figure it out, then I just assume that's intentional. And I don't view that as a good th…”
Insight
Greenblatt: Wide 52-week price swings disprove efficient market hypothesis
“And so they would show every single stock really, the high for the year was a hundred, the low for the year was 42. And every year that happened for every stock. And it didn't make sense to me that the value of the business was right at all those times. And in…”
Insight
Greenblatt: Investors only truly learn by losing their own money
“You really don't learn unless you're really investing your own money and feeling how it feels to be wrong and lose a lot of money.”
Opinion
Greenblatt: Tech mega-caps driving the market are not irrationally valued
“Most of the big indexes are driven by the Amazon, Google, Microsoft, Apple, and those businesses don't seem very irrational to me. Those are some of the greatest businesses that man has ever created partially due to the internet interconnectedness of the world…”
Assertion Supported
Greenblatt: A basket of 299 unprofitable billion-dollar companies gained over 100%
“There are now 299 companies that lost money in 2019. So this is pre-COVID. So there were money losers in 2019 with a market cap now over a billion dollars. And if you bought every single one of those money losers, those 299 companies with market caps over a bi…”
Assertion Supported
Greenblatt: Success Academy's low-income students outperform New York's wealthiest districts
“There are now 20,000 kids in 47 schools, and they would be the top district in New York City, and most of the kids 87% are minority low income. Kids. And yet they beat all the wealthiest school districts.”
Insight
Greenblatt: Puzzle-oriented investors outperform money-driven investors long term
“Some people are in it for the money and some people like solving puzzles and figuring things out and figuring what's going to happen next. And you can kind of tell the passion of those people that they're just in it for the combination of challenge and interes…”
Insight
Greenblatt: Skip unpredictable businesses with fierce competition and fast tech change
“What do you do with a business where the competition's really fierce, technology's always changing, you know, you're always coming up with new products, you know, how do you predict what, you know, when you figure out a value of a business, you're trying to fi…”
Insight
Greenblatt: Interview performance correlates poorly with job performance compared to references
“It's like they say when you interview people, some people are good at being interviewed and some people are not. Has little correlation with how they will perform if you hire them. Really, the best advice I got is talk to the people that they've worked with in…”
Insight
Greenblatt: Selling at cost and profiting from memberships creates an unbeatable flywheel
“So it's a flywheel where if you sell people products at cost, it's very hard for people who are trying to make a profit to beat you. But if you can make all your money on the memberships, just selling more and more memberships for the ability to buy it costs, …”
Insight
Greenblatt: Scalable education requires training average teachers, not hunting top talent
“The model cannot be just hiring the top one percent of teachers because you run out of those. The model has to be giving the supports necessary and the training necessary to an average teacher to become a great teacher.”
