Reading Peter Lynch’s Beating the Street
I just started reading what I’m already going to call a great book about investing by the legendary investor himself Peter Lynch. And why is Peter Lynch “legendary”? Well, he was the fund manager for what is called by some the most successful and lucrative mutual fund of all history of mutual funds, the Fidelity Magellan mutual fund.
It is said that $1,000 invested in the fund for a period of just shy of twenty years would be worth $28,000, and that’s an excellent return on your money, for those of you who don’t know much about mutual funds.
In the book, first of all, Peter makes himself more human and identifiable with a forward about why he chose to quit his very lucrative career as the Magellan fund manager. He describes why financial success of that caliber simply isn’t worth the time it takes away from family, and he has three girls of his own that he feels he missed out on a lot of their lives because the tast of managing such a large mutual fund is so time consuming.
I liked the way he described himself during that period. He said he was financially wealthy, but time-poor, and that made perfect sense. The book “Beating the Street” was on the New York Times best seller list for quite some time, and there is a good reason for it. Peter tells it like it is.
He begins by hammering home to people that stocks are much more profitable in the end than most mutual funds, money markets, T bills and other lower risk but lower yield forms of investment. He then goes on to say that if you have a large time horizon, in other words, if you are young and have lots of time for your money to grow, then stocks are REALLY the way to go.
I haven’t gotten very far in this book yet, as I’m trying to read two other books simultaneously (I know, call me crazy), but so far, it’s a great read if you’re interested in learning more about “beating the street” - Wall Street, that is.
I sure am, and I’m young enough that I still have time on my side, so I’m willing to take more risks like the legendary investors do. Oh so far, he’s really also hammered home the point that you should never invest in a company that you know nothing about, or nothing about the industry it’s in.
