One of the first books I ask new investors to read is Peter Lynch’s One Up on Wall Street.
The easy-going and simplistic stock-picking style discussed in this book brought Lynch great success in his profession as a fund manager at the US mutual fund company, Fidelity, where he generated an average annual return of 29% during 1977 to 1990.
Lynch wasn’t just a great investor, he had a wonderful way of getting across the secrets of his success in everyday language, exemplified by this warning of the perils of putting money into businesses that you don’t understand.
Another of his catchphrases was to “invest in what you know” and he believed everyone could use this advice to spot successful companies.
In fact, he got many of his best ideas at home or when wandering around shopping malls, rather than by poring over company accounts.