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There is something endearing about Peter Lynch's approach. He takes the view that the average retail (amateur) investor can beat the professionals by using common sense and exercising self-control. Whilst investment is always a gamble, the shrewd investor can find companies that swing the odds in favour of a win. Peter Lynch liked companies with a good product that he could understand - he bought into Taco Bell because he liked their coffee, and because he saw it was a strong company with sound management and plenty of room to grow. As a part of his research he would visit company offices. If he found shabby offices with frayed carpets and cracked linoleum in a downbeat part of town, he would reason that these companies put all their money into the business and not into glitzy office blocks. And he would invest. But he shied away from companies that spent their profits unwisely on unnecessary status symbols and acquisitions. All in all his advice is practical. Be your own person. Don't follow the herd. Don't worry about the macro-economic situation. Don't focus on short term movements in share price. Don't pay too much attention to complicated things like charts. Be patient. Be slow to buy and slow to sell. And above all know the company in which you're investing.
This is a charming book written by a modest and engaging character, full of great anecdotes and sound advice. It has a place in my top twenty books on investing. Thoroughly recommended,.
Lots of people will recommend
Intelligent Investor: The Definitive Book on Value Investing - A Book of Practical Counsel
as the best investing book out there (Warren Buffet included) but in my opinion this trumps it. Peter Lynch's down to earth approach to investing is very clearly explained and keeps it all very interesting which is no mean feat - investing is a very dry subject.
I particularly like the sections where he details some of his investments (good and bad) and includes the charts explaining where he bought and sold and the reasoning behind that. Peter actually goes quite in depth on some of his biggest mistakes which is a really nice touch and takes it away from being overly preachy like a lot of other investment books.
So far I've read it twice and I fully intend to read it again.
Given when the book was written a lot of what is described in the book is very outdated, naturally. The basic message he conveys though is as true today as ever. Probably truer now than ever with the amount of day traders using apps like Robinhood to blindly gamble on stocks, resulting in them being pushed up well above their real value. Certainly if everyone adhered to the logic in this book during the late 90s early 00s the Dot.com bubble wouldn't have happened. It's an entertaining read which I think provides a lot of fundamentals for being a long term investor, and how to keep your head about you during bad and good times. I will say that the author is a self proclaimed techno-phobe (despite having a large holding in Apple when he wrote the book), and mentions that he's inclined to steer clear of tech companies. As clever as this was before the dot.com crash it isn't great advice in 2020.
The perfect book for anyone new to buying stocks, a very common sense approach to investing. It's a great book to get some insights into one of the greatest investors of the last 20 years. Peters approach is very hands on, doing research on the ground and using knowledge that's available to you as an individual.
what i liked about lynch's book is that from the out set it's incredibly easy to read. too many investing books are written in such a boring, dry manner one struggles to stay awake while reading them - and more often than not feel guilty because the reader feels they are missing "great advice" when tryiong to decipher the text. not with this little gem.
the book covers how to find companies to invest in, how to value companies, and when to get out of companies invested in - the main theme running through the book is that an amateur investor can and will out perform professionals if they avoid the noise from wall street and focus on companies they understand.
the book gives great example of companies that were a "10 bagger/20 bagger" (meaning if you invested £1 you would have made £10/£20 etc.). lynch also gives example of where he missed companies/lost money as wekll - so the advice is very well rounded.
so why 4 stars? the book is well written with great examples and advice - but i question how relevant this is today when there are software packages and websites that can perform instant ratio checks, and profitability measures etc. - basically meaning that i am unsure whether lynch would have been as successful today as he was when the book was written - late 1980's. other than that, son't be put pff. this is a great book and well worth the read....
I never really understood the world of shares and sharedealing (I thought it was an specialist club for the financially educated) but this book breaks down the basics of what to look for to find a good investment.
The theme of the book is that everyday folk like me will be open to spotting great investment opportunities before anyone on Wall Street or the London Stock Exchange gets a whiff of it. Once you spot the opportunity on the street, Peter makes light work explaining how you evaluate the company before investing.
One example in the book is of a fireman who drove past a factory everyday, and everyday he saw jobs being advertised and improvements being made to the grounds and buildings. This told him the company must be doing well and was experiencing growth (and didn't need to be a financial whizz to work it out). Long story short he retired a millionaire thanks to a fairly small investment in this company that became a global brand.
This book explains that we all have first hand experience with products, brands and companies that could be great investment opportunities. We don't need to be in the financial world to spot them.
This is excellent, if a little outdated (that’s no bad thing with most investment advice calling for a long term view). The premise here is that most fund managers don’t beat the market, so how can you expect to! The guidance is to focus on keeping things low cost and diversified, as well as some other sensible advice. Very reassuring for me as a young investor.
Il libro è per metà un'autobiografia di uno dei più celebri gestori di fondi azionari (anni '80) e per l'altra un compendio di suggerimenti su come selezionare titoli azionari. L'ho letto con piacere. Nonostante l'argomento possa facilmente risultare indigesto lo stile è agile e frizzante. Istruttive anche alcune parti che illuminano sulla finanza comportamentale nel mercato azionario. Senz'altro consigliabile a chi si avvicina al mondo degli investimenti, ma anche un'ottima ricetta per fare un disastro nelle finanze personali se messo in pratica.
Il problema è che di gestori di fondi azionari 'attivi' (cioè in cui i titoli vengono selezionati appunto da... un gestore) di successo come Peter Lynch ce ne sono stati veramente pochi e per un motivo preciso. E' infatti noto a livello statistico che, nel lungo periodo, la performance dei fondi attivi è distribuita in modo casuale attorno ad una media rappresentata dagli indici di mercato (S&P500 per esempio) MENO i costi di gestione imputati al cliente (tipicamente il 2%).
In sostanza Lynch rappresenta un esempio di campione posto all'estremità superiore della distribuzione, in tutta verosimiglianza performance ottenuta per pura fortuna!
Alternativamente se ammettiamo che avesse delle qualità superiori dobbiamo domandarci perchè NOI dovremmo fare meglio di una popolazione di gestori attivi che complessivamente non fa meglio del caso (cioè di un fondo passivo indicizzato).
Leggete questo libro perchè è divertente, ma non come guida agli investimenti. Se fate sul serio fatevi un gran favore, leggete uno dei libri di Jack Bogle in cui sfata il mito della gestione attiva e indica la direzione da seguire a noi investitori: fondi indicizzati a basso costo (o in Italia un buon ETF mondiale a basso costo — più facile da acquistare).