Biography
Now retired, Lynch secured his reputation as one of the most successful fund managers in history while in charge of the Fidelity Magellan fund between 1977 and 1990.
Lynch only ever worked for Fidelity, the international investment management firm based in Boston. He started as an analyst in 1969, was promoted to director of research in 1974, and took over the Fidelity Magellan fund in 1977. At the time, it had $22m in assets. By 1990, when he decided to take early retirement in order to spend more time with his family, its value had swollen to $14bn. No manager in history has ever run so large a fund, so successfully, for so long.
His secret was a punishing work schedule, lasting six and sometimes seven days a week, in which he talked to dozens of company managers, brokers and analysts every day. With a total staff of just two research assistants, he ran a portfolio of up to 1,400 stocks at any one time. Some he bought at an early stage of growth or recovery and held for years. The majority he became dissatisfied with and sold within months, admitting that over half his choices were mistakes.
Although you cannot copy his portfolio management style, Lynch is adamant that any small investor can research stocks better than most professionals, and make smarter decisions about what to buy. This is because he or she is often better placed to spot potentially profitable investments early, and is always free to act independently, rather than constrained by committees, trustees and superiors.
During Peter Lynch's 13 successful years as manager of the Fidelity Magellan Funds, it was the top-ranked general equity mutual fund in the nation. One thousand dollars invested in Magellan in 1977 was worth $28,000 when he handed over the reins of Magellan on May 31, 1990. Since his retirement from the Magellan Fund, Lynch continues as a member of the board or trustees of the Fidelity Group of funds and writes a column for Worth magazine.
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