I have looked at Greenblatt's strategy in detail and decided to include it among the other legendary strategies I offer on my site for one reason -- it works.
As a way to invest in the stock market, Greenblatt's strategy sits comfortably among those of the giants of the investing world. Since I began following it, it is up 46.6%, compared to a loss of 14.5% for the S&P 500
Why does the strategy work? Because it looks it focuses on two variables that get to the core of successful investing -- profitability and valuation.
Pre-Paid Legal Services , which provides a form of insurance that reimburses members for legal expenses, much as medical insurance reimburses members for medical expenses. Its earnings yield is 21.19%, giving it a rank of 16 out of all stocks, and its return on total capital comes to 104.42%, earning a ranking of 32. However, when combined, Pre-Paid Legal Services is No. 4 among the stocks in our database. That's impressive.
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