A man called Peter Lynch!!

Wall Street stock investor Peter Lynch is one of the greatest investor of history. He managed the Fidelity Magellan Fund from 1977 to 1990, during which period he beat the S&P 500 index benchmark in 11 of those 13 years, achieving an annual average return of 29%. The fund grew from $20 million in 1977 to $14 billion in 1990. The little known “Fidelity Magellan Fund” became the best performer mutual fund over that period. A $1000 invested in Magellan in 1977 became $21000 by 1990, when Peter Lynch retired after thirteen years.

Often called as a “chameleon”, Peter Lynch adapted to whatever investment style work in that time. The investment Guru says that the ability to think like an amateur has helped him to adapt right kind of strategy. He uses a common –sense approach to investment. Find out the whole story behind the company before buying the stock; then keep following the story after buying the stock. He says, “Don’t sell the stock if the ‘story’ is still good, whether the market is up or down.” In picking stocks Peter Lynch stuck to what he knew or could easily understand. He only invested for the long run and paid little attention to short-term market fluctuations.

Lynch consistently applied set of eight fundamental principles to his stock selection process. According to an article by Kaushal Majmudar, a CFA at Ridgewood Group, Lynch mentions about his checklist at conference in New York in 2005.

Know what you own.

It's futile to predict the economy and interest rates.

You have plenty of time to identify and recognize exceptional companies.

Avoid long shots.

Good management is very important - buy good businesses.

Be flexible and humble, and learn from mistakes.

Before you make a purchase, you should be able to explain why you're buying.

There's always something to worry about.

He is also famous for his books co-authored with John Rothchild on stock picking, “One Up to Wall Street” (1989), “Beating The Street” (1993) and “Learn to Earn” (1996) considered mandatory reading for any investor.

Presently (2007) he is serving as vice-chairman of Fidelity's investment adviser, Fidelity Management & Research Co. He is also involved in many philanthropic work since his retirement.

Some of his famous quotes are:

The Key to making money in stocks is not to get scared out of them.

I think you have to learn that there’s a company behind every stock, and that there’s only one reason why the stocks go up. Companies go from doing poorly to doing g well or small companies grow to large companies.

In 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.

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