📖Peter Lynch
Do Your Homework First
Research before investing, not after.
Investing without research is like playing stud poker and never looking at the cards. You have to study the company before you invest, not after.
🏠 Everyday Analogy
📖 Core Interpretation
Peter Lynch emphasizes durable business quality over short-term noise. A strong model, real competitive edge, and disciplined capital allocation matter more than quarterly excitement.
💎 Key Insight：Preparation separates investing from gambling.
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❓ Why It Matters
Without business-quality filters, investors drift toward stories rather than economics. Durable cash generation is what supports long-term valuation.
🎯 How to Practice
Use a checklist covering moat, management, unit economics, and capital allocation; track long-term cash generation instead of quarter-to-quarter noise.
⚠️ Common Pitfalls
Buying narratives instead of cash-generating economics
Overreacting to short-term operating noise
Ignoring management quality and capital allocation
📚 Case Studies
1
Exiting Steel and Paper Late-Cycle (1989)
After a strong multi‑year run in steel and paper companies, Lynch reduced positions as capacity expanded and economic growth showed signs of slowing.
✨ Outcome：Missed final upside but sidestepped significant losses when the early‑1990s downturn hit cyclical manufacturers.
2
La Quinta Motor Inns Insider Sales (1986)
Lynch noticed heavy insider selling at La Quinta after strong gains. Combined with rising competition and slowing growth, insider activity signaled management thought shares were fully valued.
✨ Outcome：He reduced and eventually exited the position, reallocating to faster-growing hotel and service stocks.
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