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You can find good reasons to scuttle your equities in every morning paper and on every broadcast of the nightly news.
Peter Lynch
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Peter Lynch
Age: 80
Born: 1944
Born: January 19
Businessman
Financier
Investor
the United States of America
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Paper
News
Scuttle
Morning
Equities
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Nightly
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Investing
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Equity mutual funds are the perfect solution for people who want to own stocks without doing their own research.
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Just because you buy a stock and it goes up does not mean you are right. Just because you buy a stock and it goes down does not mean you are wrong.
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I've always said, the key organ here isn't the brain, it's the stomach. When things start to decline - there are bad headlines in the papers and on television - will you have the stomach for the market volatility and the broad-based pessimism that tends to come with it?
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A lot of people got in at the wrong time. A lot of people did very well and some people said, This is it. I'll never get back in again. And they maybe meant it, but they probably got back in again anyway.
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I talk to hundreds of companies a year and spend hour after hour in heady pow-wows with CEOs, financial analysts and my colleagues in the mutual-fund business, but I stumble onto the big winners in extracurricular situations, the same way you do.
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My method for picking stocks has never changed. When businesses go from crappy to semicrappy, there's money to be made.
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Invest in what you know.
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In our society, it's been the men who've handled most of the finances, and the women who've stood by and watched men botch things up.
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There's lots of stocks out there and all you need is a few of 'em. That's been my philosophy.
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Avoid hot stocks in hot industries.
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I like to buy a company any fool can manage because eventually one will.
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If you're prepared to invest in a company, then you ought to be able to explain why in simple language that a fifth grader could understand, and quickly enough so the fifth grader won't get bored.
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When you start to confuse Freddie Mac, Sallie Mae and Fannie Mae with members of your family, and you remember 2,000 stock symbols but forget the children's birthdays, there's a good chance you've become too wrapped up in your work.
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You only need a few good stocks in your lifetime. I mean how many times do you need a stock to go up ten-fold to make a lot of money? Not a lot.
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