Want To Be As Successful As Peter Lynch? Emulate Him.
- Posted by Jeff Carter
- on July 6th, 2013
Peter Lynch is a fabled stock picker. He ran Fidelity’s fund for years. Today’s Barron’s had an article about websites that enable you to be more like Peter when picking stocks.
One of the websites it highlighted was Ycharts. Here are excerpts of what they said:
Lynch popularized investing in stocks where he got “growth at a reasonable price,” and was always looking for good stocks selling at a discount. One graphical shortcut described in his books is to buy shares when a stock’s price line dipped significantly below fair value and sell when the price line broke above its value line.
We all want to buy low and sell high, but discounts often get buried under years of comparative values and ratios. Lynch’s line crossovers more clearly identify buy/sell levels—a picture being worth 1,000 words.
YCharts takes a slightly different tack, incorporating more of the ideas in Lynch’s books to create a model portfolio called Peter Lynch Universe. It includes 35 small- and mid-caps sporting reasonable valuations, growth rates, and low debt. YCharts claims its picks outperformed the S&P 500 index by almost 21 percentage points annually between 1992 and 2012 in back-testing.
Read the whole thing.
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Jeffrey Carter is an angel investor and independent trader. He specializes in turning concepts into profits. He co-founded Hyde Park Angels one of the most active angel groups in the United States in April of 2007. He previously served on the Chicago Mercantile Exchange Board of Directors. He has done market commentary for (More...)