Whenever you invest in any company, you're looking for its market cap to rise.
Instead of following thousands of companies, now I follow maybe fifty.
The worst fall in fifty years coincided with a brewed awakenings gift card balance Lynch golfing vacation in Ireland.She checked to make sure it would arrive on time and it did, with time to spare.Consider this: From the top in 19, the Dow produced only a fourbagger: up from 248 to 1,046 in a half century!If you can follow only one bit of data, follow the earnings assuming the company in question has earnings.Stocks suffered one of their worst declines in recent memory.Peter Lynch doesn't advise you to buy stock in your favorite store just because you like shopping in the store, nor should you buy stock in a manufacturer because it makes your favorite product or a restaurant because you like the food.Today it's the Internet, and so far the Internet has passed.I left Magellan in May, 1990, and pundits said it was a brilliant move.(I continue to serve on investment committees at various foundations and charitable groups, but in all of these cases we hire portfolio managers and let them pick the stocks.) Trendy investors might think the Lynch family portfolio belongs in the New England Society of Antiquities.
If you own a retail company, another key factor in the analysis is figuring out whether the company is nearing the end of its expansion phase what I call the "late innings" in its ball game.
By the late 1990s, nasdaq's giants (Intel, Cisco, and a handful of others) dominated the nasdaq index more than the S P 500's giants dominated its index.
The more computers that used Windows, the more the software guys wrote programs for Windows and not for Apple.
Both teach a useful lesson.
Recent developments inspire me to put in a good word for biotech not that amateurs should pick their biotech stocks out of a barrel, but that biotech in general could play the same role in the new century as electronics played in the last.
By the mid-1990s the Nifty Fifty portfolio had caught up and passed the Dow and the S P 500 in total return since 1974.
The number in the left-hand column shows where each of these companies ranked in total return on the investor's dollar.People who bought shares early were rewarded with an amazing 889-bagger: 10,000 invested in Dell from the outset generated.9 million fortune.History, with the Dow up fifteenfold.In other words, there's no "e" in the all-important "p/e" ratio.You can click on to the "briefing book" heading that's attached to the on-line version of The Wall Street Journal and Barron's, and get a snapshot review of almost any publicly traded company.All you need for a lifetime of successful investing is a few big winners, and the pluses from those will overwhelm the minuses from the stocks that don't work out.To me, this barrage of price tags sends the wrong message.Investors who see this will have time to act on their "edge.".Meanwhile we've witnessed several beneficial "unthinkables communism falls; federal and state governments in the United States run budget surpluses; America creates seventeen million new jobs in the 1990s, more than making up for the highly publicized "downsizing" of big companies.You have to keep track of where the future growth is coming from and when it's likely to slow down.Later on you'll read how I discovered some of my best stocks through eating or shopping, sometimes long before other professional stock hounds came across them.Then, in the bear market of 1973-74, the Nifty Fifty fell 50-80 percent!Stocks aren't lottery tickets.But I'd like to pass along a word of caution to people who buy shares after they've levitated.