Course 507: Great Investors: Peter Lynch
Ignoring Mr. Market
In this course
1 Introduction
2 Stick to What You Know
3 Do Your Research and Set Reasonable Expectations
4 Know the Fundamentals
5 Ignoring Mr. Market
6 The Bottom Line

The last key principle of Lynch's investment philosophy is that you should only invest for the long run and discard short-term market gyrations. Lynch has said, "Absent a lot of surprises, stocks are relatively predictable over ten to twenty years. As to whether they're going to be higher or lower in two or three years, you might as well flip a coin to decide." It might seem surprising to hear Lynch make this argument, because portfolio managers are typically evaluated based on short-term performance metrics. Nonetheless, Lynch sticks with his philosophy, adding: "When it comes to the market, the important skill here is not listening, it's snoring. The trick is not to learn to trust your gut feelings, but rather to discipline yourself to ignore them. Stand by your stocks as long as the fundamental story has not changed."

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