Joel Greenblatt has earned his place as a legend in the world of hedge and mutual funds. He is the co-chief investment officer and managing principal of Gotham Asset Management, which followed his Gotham Capital’s ten consecutive years of compounding 50 percent per year. He is an author of best-selling books about investing and an adjunct professor at Columbia Business School teaching special situation and value investing. Greenblatt is also a legendary philanthropist, contributing to $2.5 million to P.S. 65Q, a public elementary school in Queens, New York City. He helped to establish the Success Academy Charter Schools, serves as a board member for the Institute for Student Achievement, and is a Master Player and founding member of the annual virtual stock competition Portfolios with Purpose. According to Investor Mint, his net worth is estimated to be about $500 million. Greenblatt is married to Julia and they have five children together. Though he is certainly wealthy, he is much more than merely famous. His belief in successfully investing is coupled with an equally strong belief in sharing wealth for humanitarian causes. Though much is known about his financial acumen, his private life is less well-known. But his interviews offer intriguing glimpses into his thoughtful nature and personal ethics.
1. Greenblatt said, “I kind of like gambling.”
Greenblatt slipped in that statement in a Masters in Business interview with Barry Ritholtz on Bloomberg Radio but Greenblatt wasn’t talking about investing. He was talking about dog racing. Greenblatt would sneak into the dog track when he was on vacation in Florida. He and his cousin had a good time placing bets. Greenblatt admitted that half the fun of it was the sneaking in part. Together, they placed bets of dog races and lost a couple of dollars. They bet on a dog that ran its last race in 32 seconds while all the other dogs had a time of 44 seconds. They bet on the 32 seconds dog. Turned out that their dog had run a shorter race than the others and ended up losing. Greenblatt said that the dog track gave him a “cheap lesson” which taught him that you really need to know something about betting and investing because if you don’t know what you are doing, you’re going to learn a lesson in “an expensive place”.
2. Greenblatt’s first job was in the research department at Kidder Peabody on Wall Street.
It was a summer job and his duties included adjusting financial statements for inflation. He described inflation in those years as the process of dollars buying less and less each year, but the amount of those dollars dropped by about 6 to 8 percent. He compared those historic percentages to the more recent half a percent to 1 percent of what has become the norm within the last ten years or so.
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