It's just too bad that approximating his record the way he recommends is a real stretch. Lynch understood that consumers are the core of the economy, and his investment strategy reflected this.
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Read reviews that mention peter lynch wall street stock market beating the street magellan fund mutual funds fund manager average investor fund managers mutual fund make money thought process golden rules stock picking fidelity magellan buy and sell picking stocks half of the book must read buy what you know. Showing of 37 reviews. Top Reviews Most recent Top Reviews.
There was a problem filtering reviews right now. Please try again later. Peter Lynch introduced me to the wonderful world of stock investment. A great book to read before jumping into Intelligent Investor by Benjamin Graham. Kindle Edition Verified Purchase. To anyone who has an interest in investing and has at least a basic understanding of the stock market. Excellent book for the individual investor. You can do it, just like the pros. Very good material, good read. So interesting et profitable.
This is a good book, with many lessons. After a while I did feel myself wondering if I was rereading 'One up on WallStreet', as he repeats some of the same stories almost word for word. Despite that it was helpful. Not many books are written from the play by play perspective of the investor. I love how he makes fun of all the worries about the economy, and shows 'in hindsight' that those worries had no affect on the market. The market will go up and down, and it is best to be prepared for it.
I do find his approach hectic. I think Mr Lynch is addicted to the search of finding a new company to invest in.
If you manage your own portfolio there is no need to read prospectus per annum, and invest in or more of them. Nonetheless having done exactly that, with the returns that he did achieve, gave him an extra-ordinary amount of experience I guess what I find funny is that some of the other reviewers say this book does not help.
Having read the book I am really quite taken aback. This is a wonderful book! This is a book written by real investment guru with a strong track record. His advice is solid. In many ways I found this to be a very surprising book to read. What I found surprising was the degree to which Peter Lynch tries to think independently and look at the big picture. His advice is very practical and very down to earth. He follows his own instincts and does not follow other people's advice.
He tries to follow social trends and go to malls and other places - where anyone can go - to get an idea about what product or store is hot and what is not. Then he investigates the financials of that "hot" prospect. For example if he learns from his wife that a new store like the Gap or similar is suddenly full of shoppers and things are flying off the shelves, he will investigate the financials, cash flow, etc. Then he will buy and hold until that occurs, holding the stock through volatile fluctuations.
And he does that on his own. Once he can accumulate a number of multi-integer growth stocks, then the portfolio tends to take care of itself and small losers are easily written off.
A very good read. Unfortunately, you will not have the access to all the brokers, analysts, and CEOs that Lynch had by merely picking up the phone. Also, most investors do not have his knowledge of finance and business practice intricacies. Thus, his advice has to be taken with this in mind. Still, he's something of a genius and you can benefit from his experience.
His insight into why mutual fund ownership is not a good way to invest due to philosophy, fees, size, past performance ratings, etc. But his best argument against investing in mutual funds has to be, "You never know where the next great opportunity will be, so don't get stuck in a fund that won't take advantage of it.
It's just too bad that approximating his record the way he recommends is a real stretch. His "buy what you know" and "check out the local malls" makes profitable investing sound easier than it really is. Just because your local clothier is prospering doesn't mean the store in the same chain miles away is also doing a bang-up business or that corporate headquarters has got its head on straight.
One area that I wished he'd commented on more was point of entry - when to buy. He talked a lot about liking a stock but missing out on it until it had already rallied a goodly percent.
The old adage in Wall Street says "I'd rather buy a bad stock at a good price than a good stock at a bad price. Every stock has an optimum entry point and if you miss it, you shouldn't chase it. He doesn't seem to agree. He's looking for his "10 baggers. Long-term investing allows for deferred capital gains taxes, lower brokerage commission s, and a better ability to withstand market downturns.
All of these factors help to snowball your wealth over time. When stocks were tanking by ten or twenty percent, Lynch was not concerned because he knew the markets would be higher 5, 10, or 20 years down the road. The alternative to holding through recessions is selling during recessions. Investors sometimes sell stocks during recessions, hoping to either leave the markets completely or buyback their stock at lower prices.
Getting scared out of stocks tends to reduce investment returns on average. Lynch was also famous for holding stocks whose prices had already risen a great deal since his initial investment. The performance of individual investors is not measured on a quarterly basis like that of institutional investors.
Lynch understood that consumers are the core of the economy, and his investment strategy reflected this. There are numerous examples of stories where Lynch found fantastic investment opportunities in his day-to-day life.
While Lynch often got his best ideas from being a consumer himself, he did not blindly invest in these ideas without performing fundamental analysis first. Lynch emphasized that shareholders were business owners. A business owner would not execute an acquisition just because the products were popular.
The acquisition would only be completed if a reasonable valuation could be agreed upon, and the business was fundamentally sound. Lynch applied this owner mentality to his investing. As such, it is not surprising that many of his best-performing investments came from household names. Blue Chip Stocks List: One of the most helpful things for beginning investors is the ability to learn from the best in the business.
Often, high-profile and successful investors are eager to share their perspectives with those willing to listen. If you are interested in honing your investment skills by reading about other successful institutional investors, the following Sure Dividend articles may be of interest:.
Thanks for reading this article. Please send any feedback, corrections, or questions to support suredividend. Updated on February 19th, Peter Lynch is one of the most successful institutional investors of all time. Do your research Understand the importance of diversification Be patient Invest in what you know Each will be discussed in detail below. Table of Contents You can skip to a particular section of this article by using the following table of contents: Video Analysis Lesson 1: Do Your Research Lesson 2: Understand the Importance of Diversification Lesson 3: Be Patient Lesson 4: Do Your Research Investing is a research-heavy endeavor.
This persistence is well-defined in the quote below. Each is based on consecutive years of dividend increases, which shows that: Understand the Importance of Diversification Peter Lynch ran a tremendously diversified stock portfolio. Be Patient Like many other famous investors Warren Buffett comes to mind , Peter Lynch began investing at a very young age. Lynch describes this experience below.
The Long-Term Investing Guide to Compounding Wealth Lynch was also famous for holding stocks whose prices had already risen a great deal since his initial investment. Lynch invested in undergarment manufacturer Hanes after his wife expressed satisfaction with their pantyhose.