Hedge fund guru Joel Greenblatt says that, based on trailing free cash flow yields, stocks are trading at levels that put them in about the 95th percentile of cheapness when examining the past 20 years of market history. Greenblatt tells CNBC that if the past is any indication, valuation levels this low could be proceeded by a 15%-20% gain for the broader market over the next year, and gains of more than 30% for value-focused portfolios. Taking advantage of these bargains means having the fortitude to invest in some very unloved stocks, however, Greenblatt says.