How to Invest Like Peter Lynch Part 1

Peter Lynch Investment Book

Most people who will make investment in stock,option and commodities will choose a book written by Benjamin Graham " Intelligent Investor", because a lot of  people says that this book is a holy investment book. It was very reasonable because a great investor like Warren Buffet alone are praise this  book as the best investment book that ever written in the earth. In this investment book we will learn a lot about  how Benjamin Graham pick a stock.

But I personally think Intelligent Investor is a book that make me  boring and difficult  to understand. I myself do not finish reading this investment book. Although this book is very good but the material presented is too complicated, so that a novice in the field of investment should strive to understand this . For that reason I suggest to you that want to start learning to invest in stocks to read the investment book One Up on Wall

Street written by Peter Lynch. This investment book is easier to understand because principle of investment in that we read fro this investment book not as complicated as  Intelligent Investor.

Peter Lynch Biography

A lot of people think that Peter Lynch is  less  famous  compared to the Benjamin Graham and Warren Buffet. So why do we have to read an investment book that is written by not famous investor like Peter Lynch? You are wrong if you say like that about Peter Lynch . Peter Lynch also a great investor in this  world and his name can be align with the investment guru like Warren Buffett and Benjamin Graham. That why Peter Lynch tips and advice about investment also valuable to read.

One proof of Peter Lynch is a great investor is when Peter Lynch become an investment manager or commonly known as the fund manager for Fidelity's  Magellan  Company in 1990. Fidelity's  Magellan is a giant investment company in the United States. During this period Peter Lynch success  to multiply their  investor funds from $ 10,000 in 1977 to $ 200,000 over 10 years. Multiplied that investor fund more than 19 times from its first value. Thats why I says that Peter Lynch are as genius investor like Warren Buffet and Benjamin Graham.

Basic of Peter Lynch Investment Principle

The advantages investment book that written by Peter Lynch  is because of what he wrote is investing tips  for the beginner  investor with small capital, unlike other investment books that are more suitable to be read by a big capital investors (Big Boys). Peter Lycnh tips given in this investment book is her perspective on investing from the eyes of an investor (small capital investor)  rather than a fund manager (investor with big capital). So I think all beginner investors or traders around the world both in Asia, Europe, Africa, Australia and America needs to read this Peter Lynch investment book.

In this investment book Peter Lycnh dividing the investment in three step :

1. Preparation for investment
2.  How to pick a profitable  stocks
3.  Longterm value of this stock

By mastering these three things then a beginner investor  will be able to pick stocks based on their own analysis. So to pick a stock they do not only rely on advice that given by a stock analysts or economists. There are at least three reasons why beginner investor  should not just following  the recommendations of the profesional stock analysts:

1.  Not all  recommendations stock are profitable
2.  If  stock analysts' recommendations that were true, they only give a recommendation to buy stock without  appropriate  advice when we must  sell the stock that already purchased.
3. You can actually do better stock analysis by utilizing the information resources that are around of you.

We should be able to analyze how to pick a good stocks and do not just  rely on the recommendation of the stock analysts. This is important because by doing this a beginner investor would be able to avoid false stock analysts signal that provided by a person who only read a few books with  investment experience just about 1-2 years then self-proclaimed expert on the stock (or forex, or commodity, or options). Or some one who  wrote an investment book and held an expensive investment seminars to get their own benefit by promising you a magic formula to pick a stock so you can gain a lot of money in the stock business.

Next Article Invest Like Peter Lynch Part 2