Investment Stategies

PETER LYNCH

As corporate profits increase, corporations become more valuable, and sooner or later, their shares will sell for a higher price.

I think the secret is if you have a lot of stocks, some will do mediocre, some will do okay, and if one or two of ’em go up big time, you produce a fabulous result.

Gentlemen who prefer bonds don’t know what they’re missing.

The simpler it is, the better I like it.

People worry about the riskiness of stocks, but bonds can be just as risky.

If your only reason for picking a stock is that an expert likes it, then what you really need is paid professional help.

What makes stocks valuable in the long run isn’t “the market.” It’s the profitability of the shares in the companies you own.

Go for a business that any idiot can run – because sooner or later any idiot probably is going to be running it.

If discounting terrific things are already in the stock, I don’t want to own it.

Know what you own, and know why you own it.

There’s no shame in losing money on a stock. Everybody does it.

What is shameful is to hold on to a stock, or worse, to buy more of it when the fundamentals are deteriorating.

All you need for a lifetime of successful investing is a few big winners, and the pluses from those will overwhelm the minuses from the stocks that don’t work out.

To make money, you must find something that nobody else knows, or do something that others won’t do because they have rigid mind-sets.

The person that turns over the most rocks wins the game. And that’s always been my philosophy.

Never invest in any idea you can’t illustrate with a crayon.

In our society, it’s been the men who’ve handled most of the finances, and the women who’ve stood by and watched men botch things up.

If you’re lucky enough to have one golden egg in your portfolio, it may not matter if you have a couple of rotten ones in there with it.

The strength of our economy is that it is dynamic and always adapting to changing conditions. That’s our advantage in the world.

You can lose money very fast, in two months, but you very rarely make money very fast in the stock market. When I look back, my great stocks took a long time to work out.

In stocks as in romance, ease of divorce is not a sound basis for commitment.

You don’t get hurt by things that you don’t own that go up. It’s what you do own that kills you.

Whenever you invest in any company, you’re looking for its market cap to rise.

This can’t happen unless buyers are paying higher prices for the shares, making your investment more valuable.

Never invest in any company before you’ve done the homework on the company’s earnings prospects, financial condition, competitive position, etc.

The worst thing you can do is invest in companies you know nothing about. Unfortunately, buying stocks on ignorance is still a popular American pastime.