Investing in the Market : Recalling The Golden Rules of Peter lynch

On an average the Indian market has given a 19% return in the last financial year that is the 3rd highest return after Egypt & Brazil who gave the better returns. The underlying is how many made the money because the markets where volatile , ruthless and driven by crisis over the year.

Wondering whether the 20 golden rules holds true for today’s market scenario :

  1. Your investor’s edge is not something you get from Dalal/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.
  2. Over the past 3 decades, the stock market has come to be dominated by a herd of professional investors. Contrary to popular belief, this makes it easier for the amateur investor. You can beat the market by ignoring the herd.
  3. 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.
  4. You have to know what you own, and why you own it. “This baby is a clinch to go up!” dosen’t count.
  5. Long shots almost always miss the mark

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