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Both approaches can work, but the concentrated approach is more volatile - you can lose 20-30% of your net worth in a few days. The diversified approach is less volatile but also less likely to produce outsized returns.
Greenblatt sees value in both approaches, depending on the investor's goals and risk tolerance.
The Rise of Passive Investing
Greenblatt believes passive investing is the right solution for most people, as it's very difficult to consistently beat the market.
However, he still sees opportunities for skilled active investors who can properly value businesses. The rise of passive investing may have actually created more opportunities in some areas.