Thread by @RamBhupatiraju

Nice article on "5 Investing Gems from Peter Lynch I Wish I’d Known Earlier".

medium.com/live-your-life…

1⃣ Investing Is an Art, Not a Science

2⃣ When in Doubt, Tune in Later

3⃣It Takes More Than One Great Product for a Company to Be Worth Investing In

4⃣ Be Suspicious of Co's With Growth Rates of 50–100% a Year (see details)

5⃣ Companies That Have No Debt Can’t Go Bankrupt

Few pts I liked in each.

1. Investing Is an Art, Not a Science

"You need to be disciplined and patient and have the ability to remove emotion from your decision making.

Understand the nature of the companies you own and the specific reasons for holding the stock.

A stock is a share in a business. So it’s important to understand what kind of “business” you are getting into. And then you must have specific reasons to buy and hold the stock."

2. When in Doubt, Tune in Later

"Check if you are being impacted due to
-Biased due to spending time on research?
-Getting over-confident with analysis?
-Impressed with the Company only due to the recent performance?

-Attracted to the stock only because it has recently fallen in price?
-Like it due to getting a tip from someone?"

3. It Takes More Than One Great Product for a Company to Be Worth Investing In

"Companies selling products or services that everyone loves or is talking about are worthy of “considering” as a potential investment.

But, as an investor, the greater task for you is to know how much of that great product or service means to the company.

If it does not contribute meaningfully to the company’s sales and profits, it can’t be the core reason for buying that stock."

4. Be Suspicious of Companies With Growth Rates of 50–100% a Year ( I don't necessarily agree with this point).

My comments -
Extreme growth (financed by high debt levels, or large shareholder dilution), Extreme short-term growth (due to fad/hype products) are risky,

but high/sustainable growth supported by strong trends, great execution, which is also enhancing the Competitive positioning of the Company (while not risking the Financial position) is good from a fundamental perspective.

Valuation and performance vs built-in expectations are obviously important for the short term stock performance.

5. Companies That Have No Debt Can’t Go Bankrupt

"Companies that borrow money to grow their businesses might appear good (because they are ‘growing’).

But more often than not, such companies get so much intoxicated by the growth that they end up making a mess of their balance sheets, and in the process, destroying whatever shareholder wealth they created during “growth” years."