People don’t understand their natural Advantages and they don’t use it. That’s bad but even worse. If you don’t think you’re not a good ice skater you are not going to try but people are buying stalk anyways and they are not discouraged, they just think it’s a gamble. They buy stock for a week and a half and then it goes up, they make $2 out of it and resell it when 3years pasts all they’ve done is generate a lot of commission and they probably lost money . That’s a mistake.
If you don’t understand a company if you can’t Explain it to a 10years old in 2minute or less don’t own it because that is where it goes down.
Let’s begin with Peter Lynch “Time” magazine has called him America’s number one money manager During the thirteen years he was head of the fidelity Magellan fund. It was a top ranked General equity mutual fund.
He’s new book “beating the street” offers on picking stocks and maximizing profits.
Few key points Peter Lynch talked about in regards to stocks
Lych said: I don’t think people understand this, there’s a 100% correlation to what happens to a company’s earnings over several years and what happens to the stock. If the company has done very well for example: MC Donald’s then it means the stock has also done well.
People worry about Too much money supply, the price of the oil ,the president, who’s been nominated to the supreme court and all that. if MC Donald’s earning goes up in the Ten years then the stock will go up but these other things earlier mentioned influences the Earnings of a particular company because if we’re in a recession nobody is going to spend as much money going to the movies or whatever else they do.
If you don’t understand the way a company works you should not be in it because if you could predict the stock market , you could predict economy, you could predict interest rate.
If you go buying the wrong stalk you’re going to loose all your money anyways. Buy In your industry! Buy what you know! Buy local companies.
Kindly watch the video below to understand more 👇🏿
