Peter Lynch facts for kids

Peter Lynch (born January 19, 1944) is a famous American investor, author, and generous giver. He is best known for managing a special investment fund called the Magellan Fund. This fund was part of Fidelity Investments.

From 1977 to 1990, Peter Lynch helped the Magellan Fund grow a lot. He made it one of the best-performing funds in the world. The fund's value grew from about $18 million to over $14 billion! He also wrote popular books about investing. These books helped many people learn how to invest their money. He taught people to "invest in what you know."

Early Life and Education

Peter Lynch was born in Newton, Massachusetts, on January 19, 1944. When he was seven, his father got sick and passed away. His mother then had to work to support the family. Peter started working as a caddie (carrying golf clubs) when he was a teenager. This helped him earn money for his family.

While in college, he used his savings to buy shares in a company. He bought 100 shares of Flying Tiger Airlines for $8 each. Later, these shares were worth $80 each. The money he made helped him pay for his education.

In 1965, Peter graduated from Boston College. He studied history, psychology, and philosophy there. He then earned a Master of Business Administration (MBA) degree in 1968. This was from the Wharton School of the University of Pennsylvania.

Investment Career Highlights

Starting at Fidelity

In 1966, Peter Lynch got an internship at Fidelity Investments. He had caddied for Fidelity's president, D. George Sullivan. This connection helped him get the job. He first studied companies in paper, chemicals, and publishing.

After serving in the Army for two years, he returned to Fidelity in 1969. He then focused on textiles, metals, and mining companies. From 1974 to 1977, he became Fidelity's director of research.

Leading the Magellan Fund

In 1977, Peter Lynch became the head of the Magellan Fund. At that time, it was a small fund with $18 million. When he left in 1990, the fund had grown hugely. It managed over $14 billion in assets. It also held shares in more than 1,000 different companies.

From 1977 to 1990, the Magellan Fund earned an average of 29.2% each year. This made it one of the most successful mutual funds ever. Peter Lynch could buy many different types of stocks. He looked for individual companies he thought were good investments. He found success in many different industries.

Some of his most profitable investments included Fannie Mae, Ford, and Philip Morris. He also invested in companies like MCI, Volvo, and General Electric.

Peter Lynch's Investing Ideas

Peter Lynch wrote three books about investing. These books were One Up on Wall Street, Beating the Street, and Learn to Earn. The last book was written for young investors, like teenagers. His books explain his simple but powerful investing methods.

His most famous idea is, "invest in what you know." This means you should buy stocks in companies you understand. For example, if you love a certain brand of sneakers, you might research that company. If it's doing well, it could be a good investment. Peter Lynch believed that everyday people can find great investments. They can spot good companies in their daily lives.

He once invested in Dunkin' Donuts. He didn't read about it in a newspaper. Instead, he liked their coffee as a customer. He noticed their stores were always busy. After checking their financial health, he decided to invest. It became one of his best investments. He taught that paying attention to businesses around you can lead to smart choices.

Peter Lynch also studied philosophy and logic in college. He felt these subjects were more important to his investing success than math or finance. He learned to trust real-world experience over complex theories.

He also warned against trying to guess when the market will go up or down. He said, "Far more money has been lost by investors preparing for corrections or trying to anticipate corrections than has been lost in the corrections themselves."

Lynch also made popular the idea of "GARP." This stands for "Growth At A Reasonable Price." It means finding companies that are growing but are not too expensive.

He also created the term "ten bagger." This means an investment that grows to be ten times its original price. It comes from baseball, where a "four-bagger" is a home run. A "ten bagger" in investing is like hitting two home runs and a double!

Personal Life and Giving Back

Peter Lynch married Carolyn Ann Hoff. They had three daughters. Together, they started the Lynch Foundation. Carolyn passed away in 2015.

Peter Lynch is known for his philanthropy. This means he gives a lot of money to good causes. He sees giving money away as a type of investment. He likes to support ideas that can help many people. For example, he supported First Night, a New Year's Eve festival. He also supported City Year, a community service program.

The Lynches have given money in many ways. They donated $10 million to Peter's old college, Boston College. The college even named the Lynch School of Education and Human Development after his family.

The Lynch Foundation has given away over $80 million since it started. It supports education, religious groups, and hospitals. For example, it gave $20 million to start the Lynch Leadership Academy. This program trains school principals. The Foundation was also an early supporter of Teach For America and Partners In Health. In 1991, Peter Lynch was added to the Junior Achievement U.S. Business Hall of Fame.

Peter Lynch is also a member of the Harvard Medical School Board of Fellows.

Honors

Peter Lynch received the 1992 Seton Award. This award is from the National Catholic Education Association.

See also

In Spanish: Peter Lynch para niños