13 best insights about financial markets by Peter Lynch:
The 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.
People who succeed in the stock market also accept periodic losses, setbacks, and unexpected occurrences. Calamitous drops do not scare them out of the game.
Big companies have small moves, small companies have big moves.
When you sell in desperation, you always sell cheap.
Remember, things are never clear until it’s too late.
Understand the nature of the companies you own and the specific reasons for holding the stock. (“It is really going up!” doesn’t count.)
When looking at the same sky, people in mature industries see clouds where people in immature industries see pie.
Stocks you trade, it's wives you're stuck with.
There are five basic ways a company can increase earnings:
1. reduce costs;
2. raise prices;
3. expand into new markets;
4. sell more of its product in the old markets; or
5. revitalize, close, or otherwise dispose of a losing operation.
1. reduce costs;
2. raise prices;
3. expand into new markets;
4. sell more of its product in the old markets; or
5. revitalize, close, or otherwise dispose of a losing operation.
Avoid hot stocks in hot industries.
Investing without research is like playing stud poker and never looking at the cards.
If you’re considering a stock on the strength of some specific product that a company makes, the first thing to find out is: What effect will the success of the product have on the company’s bottom line?
You have to keep your priorities straight, if you plan to do well in stocks.
Loading suggestions...