Top 13 Most Famous Peter Lynch Quotes on Economy & Investing
It takes remarkable patience to hold on to a stock in a company that excites you, but which everybody else seems to ignore. You begin to think everybody else is right and you are wrong. But where the fundamentals are promising, patience is often rewarded.”
Peter Lynch
PinNever invest in any idea you can’t illustrate with a crayon.PinThe trick is not to learn to trust your gut feelings, but rather to discipline yourself to ignore them. Stand by your stocks as long as the fundamental story of the company hasn’t changed.PinOwning stocks is like having children – don’t get involved with more than you can handle.PinWhenever 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.PinTime is on your side when you own shares of superior companies.PinPeople who succeed in the stock market also accept periodic losses, setbacks, and unexpected occurrences. Calamitous drops do not scare them out of the game.PinKnow what you own, and know why you own it.PinAverage investors can become experts in their own field and can pick winning stocks as effectively as Wall Street professionals by doing just a little research.PinIn stocks as in romance, ease of divorce is not a sound basis for commitment. Also read: Love QuotesPinEvery time you have one of these recessions, there are always groups who say it is different this time. We won’t get out of this one.PinWhen you sell in desperation, you always sell cheap.PinThe key to making money in stocks is not to get scared out of them.
67 Best Peter Lynch Quotes to Help You Become Wiser in Stock Investing
If you’re prepared to invest in a company, then you ought to be able to explain why in simple language that a fifth grader could understand, and quickly enough so the fifth grader won’t get bored.”
Peter Lynch
PinThere’s no such thing as a worry-free investment. The trick is to separate the valid worries from the idle worries, and then check the worries against the facts.PinWith every company, there is something to worry about, but the question is, which worries are valid and which are not?PinRemember, things are never clear until it’s too late.PinThere’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.PinThe strength of our economy is that it is dynamic and always adapting to changing conditions. That’s our advantage in the world.PinMy idea of a great business is one that has a shortage of competitors.PinIn business, competition is never as healthy as total domination.PinYour investor’s edge is not something you get from Wall Street experts. It’s something you already have.PinYou can outperform the experts if you use your edge by investing in companies or industries you already understand.
If you can follow only one bit of data, follow the earnings—assuming the company in question has earnings. As you’ll see in this text, I subscribe to the crusty notion that sooner or later earnings make or break an investment in equities. What the stock price does today, tomorrow, or next week is only a distraction.”
Peter Lynch
PinBehind every stock is a company. Find out what it’s doing.PinNever invest in any company before you’ve done the homework on the company’s earnings prospects, financial condition, competitive position, etc.PinBig companies have small moves, small companies have big moves.PinAll else being equal, invest in the company with the fewest color photographs in the annual report.PinJob insecurity has been a problem for as long as people have depended on a paycheck.PinIf it’s a choice between investing in a good company in a great industry, or a great company in a lousy industry, I’ll take the great company in the lousy industry any day.PinGentlemen who prefer bonds don’t know what they’re missing.
Good management, a strong balance sheet, and a sensible plan of action will overcome many obstacles, but when you’ve got weak management, a weak balance sheet, and a misguided plan of action, the greatest industry in the world won’t bail you out.”
Peter Lynch
PinGo for a business that any idiot can run – because sooner or later any idiot probably is going to be running it.PinThe old Wall Street adage “never invest in anything that eats or needs repairs” may apply to racehorses, but it’s malarkey when it comes to houses.PinThe more cash that builds up in the treasury, the greater the pressure to piss it away.PinThe secret of his success is that he never went to business school. Imagine all the lessons he never had to unlearn.PinIf you can’t find any companies that you think are attractive, put your money in the bank until you discover some.
The way you lose money in the stock market is to start off with an economic picture. I also spend fifteen minutes a year on where the stock market is going. All these great, heady, thinking deals kill you.”
Peter Lynch
PinBuy only what you understand, believe in, and intend to stick with – even when others are chasing the next miracle.PinIf you don’t study any companies, you have the same success buying stocks as you do in a poker game if you bet without looking at your cards.PinIf discounting terrific things are already in the stock, I don’t want to own it.PinYou don’t get hurt by things that you don’t own that go up. It’s what you do own that kills you.PinThe person that turns over the most rocks wins the game. And that’s always been my philosophy.
In the long run, a portfolio of well chosen stocks and/or equity mutual funds will always outperform a portfolio of bonds or a money-market account. In the long run, a portfolio of poorly chosen stocks won’t outperform the money left under the mattress.”
Peter Lynch
PinYou have to say to yourself, “If I’m right, how much am I going to make? If I’m wrong, how much am I going to lose?” That’s the risk/reward ratio.PinYou have to keep your priorities straight if you plan to do well in stocks.PinUnderstand the nature of the companies you own and the specific reasons for holding the stock. (“It is really going up!” doesn’t count.)PinThe very best way to make money in a market is in a small growth company that has been profitable for a couple of years and simply goes on growing.PinA lot of my stocks don’t work. The beauty of the stock market is that if you are wrong, if you put $1,000 up, all you lose is $1,000. I have proven that many times.PinDon’t buy “cheap” stocks just because they’re cheap. Buy them because the fundamentals are improving.PinThis is one of the keys to successful investing: focus on the companies, not on the stocks.PinStocks do well for a reason and do poorly for a reason. Make sure you know the reasons.
When you start to confuse Freddie Mac, Sallie Mae and Fannie Mae with members of your family, and you remember 2,000 stock symbols but forget the children’s birthdays, there’s a good chance you’ve become too wrapped up in your work.”
Peter Lynch
PinTo make money, you must find something that nobody else knows, or do something that others won’t do because they have rigid mind-sets.PinI deal in facts, not forecasting the future.PinThe basic story remains simple and never-ending. Stocks aren’t lottery tickets. There’s a company attached to every share.PinPeople worry about the riskiness of stocks, but bonds can be just as risky.PinLong-term bonds can be almost as volatile as stocks. They have their own corrections.PinThe worst thing you can do is invest in companies you know nothing about. Unfortunately, buying stocks on ignorance is still a popular American pastime.PinIn this business, if you’re good, you’re right six times out of ten. You’re never going to be right nine times out of ten.PinThe biggest winners are surprises to me, and takeovers are even more surprising. It takes years, not months, to produce big results.PinYou 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.PinThe typical big winner in the Lynch portfolio generally takes three to ten years to play out.PinI 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.PinAll 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.PinIf 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.PinAs corporate profits increase, corporations become more valuable, and sooner or later, their shares will sell for a higher price.PinWhat makes stocks valuable in the long run isn’t “the market.” It’s the profitability of the shares in the companies you own.PinThe market at this point is institutional and we all act like a herd.PinMissing the bottom on the way up won’t cost you anything. It’s missing the top on the way down that’s always expensive.PinIf you’re in the market, you have to know there’s going to be declines.PinIn the long run, it’s not just how much money you make that will determine your futureprosperity. It’s how much of that money you put to work by saving it and investing it.
If you’re lucky enough to have been rewarded in life to the degree that I have, there comes a point at which you have to decide whether to become a slave to your net worth by devoting the rest of your life to increasing it or to let what you’ve accumulated begin to serve you.”
Peter Lynch
PinYou remind yourself that nobody on his deathbed ever said, ‘I’d wish I’d spent more time at the office.’PinIt’s human nature to keep doing something as long as it’s pleasurable and you can succeed at it, which is why the world population continues to double every 40 years.PinInvesting in stocks is an art, not a science, and people who’ve been trained to rigidly quantify everything have a big disadvantage.PinAs I look back on it now, it’s obvious that studying history and philosophy was much better preparation for the stock market than, say, studying statistics.PinIn 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.PinIf your only reason for picking a stock is that an expert likes it, then what you really need is paid professional help.PinThe simpler it is, the better I like it. Also read: Minimalism Quotes
Peter Lynch Short Biography
Born on 19 January 1944 in Newton, Massachusetts, U.S., Peter Lynch is one of the most well-known investors who managed to realize annual returns of 29.2% as head at Fidelity Magellan between 1977 to 1990.
When he took over, Fidelity Magellan only had $20 million in assets, by 1990, the company grew to over $14 billion. Peter Lynch and his team managed to outperform the S&P 500 index almost every year. His success allows him to retire at a young age of 47.
Credited for his invention of the price-to-earnings-growth (PEG) ratio, Peter Lynch has helped many investors determine a stock growth potential by using the valuation methods.
Peter Lynch is also an astonishing Philanthropist. In 2005, the Lynch Foundation was built to support research in education, religious organizations, hospitals and medicine, and various cultural and historical organizations.
Here are the best Peter Lynch quotes so you can be inspired to do your homework, invest in the long term, and not allow the volatility of the market to cloud your vision.
Overcoming depression and suicidal thoughts, Jeremiah Say found solace in quotes. After filling countless pages with resonating words, he moved his collection online to save trees and inspire others. Thus, GraciousQuotes.com was born. Jeremiah firmly believes in the power of quotes to swiftly spark inspiration during hard times. His blog is dedicated to uplifting others through these shared wisdoms. Discover more about Gracious Quotes or get in touch with Jeremiah.