The main focus in this section for Lynch is on being your own investor. Clearly, Lynch’s argument here is that it’s ok to have an occasional strikeout when you invest in individual businesses, because you’ll also have the occasional (or hopefully for you regular) grand slam. Of course he doesn’t want to lose money, but he makes the point that if you have six stocks and five of them go to zero (business goes bankrupt) and one turns into a “tenbagger,” your rate of return is still 66%. In other words the stock is bought at a value of £ 10 and when it increases to a value of £ 100, then you have a “tenbagger.” Whereas Warren Buffett lives by investing rule number one: “never lose money,” Lynch has a different idea.
Lynch starts with a passionate argument to search for so called “tenbaggers,” which refers to stocks that increase their value 10 times from their initial investment. Right there, you have the beginnings of investment choices. Or maybe you favourite new restaurant chain which is always packed when you visit. What industries do you know inside out? For example through your work and businesses you deal with in your work. In One up on Wall Street, Lynch introduces the idea that everyday observations can help you identify businesses, and with that stocks, that you can make a financial killing on. That puts Lynch out there with the world’s greatest investors. Simply said, an £ 1,000 investment in the fund in 1977 would have generated to a return of £ 29,200 in 1990. Under his leadership the fund generated an annualised return of 29.2%.
Lynch was portfolio manager of the Fidelity Magellan Fund, which was the world’s best performing fund under his leadership from 1977 to 1990.
ONE UP ON WALL STREET REVIEW PROFESSIONAL
In One up on Wall Street, Peter Lynch describes how retail investors can invest successfully in individual businesses and beat the big funds and professional investment managers.
ONE UP ON WALL STREET REVIEW HOW TO
This is a great book for new and relatively inexperienced investors, who want to learn and understand how to invest their hard-earned money in the stock market.
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