Look at any list of the top investing books and this book will normally be up towards the top. One Up On Wall Street by Peter Lynch is not your conventional style of investing books. Even though this book isn’t a dividend investing book, I still felt as though there was some good information that I could learn from. The book doesn’t go into any big fancy math calculations or formulas but what it does do is break investing down to a very basic thought process. That simple thought process is that you buy what you know. He states that some of his best investing ideas have come from his or someone he knows interacting with a company. His theory makes a lot of since in the fact that the consumer is what drives the earnings and that in turn should drive the stock price up. So if you see a brand or store constantly starting to show up in your life, it may be a good idea to check and see if it is a public company.
One of his big points in the book was trying to locate the tenbaggers. These are stocks that have increased 10 times their initial price offering. While this is a great strategy for someone who is strictly looking for capital appreciation, it does not directly apply to me since I am looking for my stocks to appreciate while they pay me growing dividends. Peter Lynch talks about all this in the book though. He also identified stocks using one of several identifiers such as: slow growers, fast growers, cyclicals, turnarounds and stalwarts. These identifiers are now pretty commonly spoken even with your small time individual investor. In the book, he discusses each one and what would be the best ways to strategize them.
Peter Lynch is someone with very astounding credentials. He ran Fidelity’s Magellan mutual fund from 1977 to 1990 and in that amount of time he increased the assets under management from $18 million to $14 billion. With that type of track record I believe that he is worth listening to when it comes to investing. One thing to keep in mind is that the nature of his job is to continually produce good returns. With this being said he cannot really stick to buying great dividend paying stocks and holding them for a long time.
In the book he talks about the fact that you can hold a lot of stocks that give you a decent return but it only takes one to make a homerun. He chronicles some of his homeruns that he has had during his career. He also covers some of his misses. Lynch allows you to learn from his decades of investing experience. One thing to keep in mind about this book is the fact that it is Peter Lynch’s investing style. It may not be the best investing style for you. What I am doing is learning all of the different styles of the great investors that came before me. I would like to think that I am learning a little bit from all of their investing styles so that I can continually improve my own investing style.
Have you read this book? If so I would love to hear what you think about it. I plan to continue to expand my horizon as far as investing books are concerned, so if you have any recommendations then I would love to hear about them.
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I hope that you have enjoyed reading my thoughts on this book. I hope that all has been going well and until next time…. happy investing!!!