www.MagicFormulaInvesting.com

This free site (www.MagicFormulaInvesting.com) created by Joel Greenblatt, Founder and Managing Partner at Gotham Capital (a private investment partnership that has achieved outstanding returns since its inception in 1985) shows you how "beating the market" can be made simple and easy.

The strategy is to buy 20 to 30 stocks and hold them for a year. If you cannot buy all stocks at one time, you can buy 2-3 stocks every month and hold them for a year.

Here's how it works.

1.

Use the Stock Screener to select the top-rated stocks from the database. Choose the number of stocks to view, and choose the size of the company you want in the list. Choosing more companies leads to greater diversification, and choosing larger companies generally leads to less volatility. Eliminate any companies you do not want to own for any reason; however, you should keep at least 20 stocks in an effort to properly manage risk.

2.

Use a cost effective way to purchase the stocks. If the amount you are investing represents a large percentage of your long-term investment portfolio, you may want to consider making multiple portfolio purchases over a 12 month period.

3.

Keep your stocks for approximately one year. The system is designed to maximize your after-tax returns; therefore, you want any gains to become long-term by holding them for a year, and you want to sell any losses before the one year holding period is reached.

4.
Once you have sold any gains and any losses, select and purchase a new portfolio of screened stocks.