People

Peter Lynch

Peter Lynch

Formal First Name
Peter
Dates
1/14/1944 - present

Peter Lynch is one of the prominent money managers of all time. He is a famous investor who rose to prominence for managing the Fidelity Magellan Fund, a groundbreaking mutual fund he ran from 1977 to 1990. Lynch is also known for pioneering Growth At a Reasonable Price (GARP), an equity investment strategy that combines attributes of both growth investing and value investing. In addition to this, he is credited for popularizing the Price/Earnings-to-Growth, a ratio used to determine a stock's value while also factoring in the company's expected earnings growth.

Professional Experience


Academic History

EARLY LIFE AND CAREER
  • Lynch developed his interest in the markets at the young age of 11. He got captivated by the conversations he overheard while working as a caddy at an upscale golf club.
  • He attended Boston College on a partial scholarship and paid the rest by caddying.
  • Having caddied for Fidelity's president for eight years helped him land a job at the company.
  • He got his first full-time job at age 25 as a textiles and metals analyst at Fidelity.
  • His first successful investment was in an air-freight company called Flying Tiger, which helped him pay for graduate school.
  • He served in the Army from 1967 through 1969.

  • Lynch became the fund's manager in 1977 when it had $20 million in assets.
  • His impressive track record at Magellan drew investors at a fast rate.
  • By 1983, Fidelity Magellan Fund's assets peaked at $1 billion.
  • During the 13 years he ran the fund, Magellan outperformed the annual return of the S&P 500 stock index 11 years.
  • From 1977 to 1990, the fund generated 29.2% CAGR returns.

  • You should invest only in what you understand.
  • You should do your homework and research an investment thoroughly.
  • You should focus more on a company's fundamentals and not the market as a whole.
  • You should invest only for the long run and discard short-term market gyrations. 


IDEAS

  • Lynch thinks individual investors can perform well by investing in what they know and by getting to know a company, its business model, and its fundamentals.
  • He believes in investing for the long term and choosing companies whose assets Wall Street has undervalued.
  • He thinks companies with historically below-average price-to-earnings ratios for their industry and for the company have the potential to perform well.