These are my all time favorite rules which I try to follow and they are applicable in all the forms of market across the globe.
- Your investor’s edge is not something you get from Wall Street experts. It’s something you already have. You can outperform the experts if you use your edge by investing in companies or industries you already understand.
- Over the past 3 decades, the stock mkt has come to be dominated by by a herd of professional investors. Contrary to popular belief, this makes it easier for the amateur investor. You can beet the market by ignoring the herd.
- Often there is no correlation b/w success of a company’s operations and the success of its stock over a few months or even years. In the long term there is 100% correlation b/w the success of the company and the success of the stock. This disparity is the key to making money: it pays to be patient, and to own successful companies.
- You have to know what you own, and why you own it. “This baby is a clinch to go up!” dosen’t count.
- Long shots almost always miss the mark Continue reading “The Peter Lynch golden rules :”