Peter Lynch Once his visions are shared on determining growth opportunities in the stock market today.
What happened: In an interview in 2019, Lynch stressed the importance of growth shares. He explained that growth shares are those that have significantly increasing sales, and not only those who have increasing profits. He warned against the wrong growth companies of the turning or periodic companies.
to talk with Barron, Lynch pointed out the success of the negative management in attracting assets, although he indicated that this trend did not affect sincerity. Many of the sincerity boxes, including low -prices stocks (FLPSX), Sincerity (FCNTX), and the FDGRX growth company, which constantly outperformed its standards.
“After 50 years of doing it professionally, it enhances growth shares better than NonGrowth shares. Growth shares, by definition, as sales have already grown,” said Lynch.
Also read: Teacher Peter Lynch’s investment: “If you cannot explain a 11 -year -old child in two minutes or less why you have stocks, you will not own it.”
“People confuse them and increase profits, however [if you just look at earnings growth] You are confused in transformation and medicine. He added that the company can move from money loss to 2 % margin to 12 % margin, and profits rise six times – but this is not a growth company.
When asked about the characteristics of a successful company, Lynch stated that his best shares are those that were not worried about the big picture. He referred to examples of successful local companies such as Stop & Shop and Dunkin ‘Donuts.
He expressed regret that he did not invest in companies such as Walmart and Sherwin Williams earlier.
He also stressed the need for comprehensive research before making investment decisions and warned against extracting conclusions without a strong basis.
Why do it matterLynch’s advice comes at a time when the stock market is witnessing a lack of growth companies. He suggested that investors look at the transformation, private situations, and departments if they could not find growth companies.
His concern about the current shortage of growth companies and potential consequences is strong if this trend continues, and highlights the advanced dynamics of the stock market.
Read after that
Eternal Advice of Peter Lynch: “The person who converts most rocks wins in the game”
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