Peter Lynch Lyrics: Missing The Obvious

The following notes was taken from a forum posting. If not mistaken the original writings were posted at Wallstraits.com.

Lynch Lyrics
Missing the obvious

"Who would have had a greater advantage than yours truly, sitting in an office at Fidelity during the boom in financial services and in the mutual funds? This was my chance to make up for missing Pebble Beach. Perhaps I can be forgiven for that incredible asset play. Golf and sailing are my summer hobbies, but mutual funds are my regular business."

"I'd been coming to work here for nearly two decades. I know half the officers in the major financial-service companies, I follow the daily ups and downs, and I could notice important trends months before the analysts on Wall Street. You couldn't have been more strategically placed to cash in on the bonanza of the early 1980s."

"The people who print prospectuses must have seen it--they could hardly keep up with all the new shareholders in the mutual funds. The sales force must have seen it as they crisscrossed the country in their Winnebagos and returned with billions in new assets. The maintenance services must have seen the expansion in the offices at Federated, Franklin, Dreyfus, and Fidelity. The companies that sold mutual funds prospered as never before in their history. The mad rush was on."

"Fidelity isn't a public company, so you couldn't invest in the rush here. But what about Dreyfus? Want to see a chart that doesn't stop? The stock sold for 40 cents a share in 1977, then nearly $40 a share in 1986, a 100-bagger in 9 years, and much of that during a lousy stock market. Franklin was a 138-bagger, and Federated was up fiftyfold before it was bought out by Aetna. I was right on top of all of them. I knew the Dreyfus story, the Franklin story, and the Federated story from beginning to end. Everything was right, earnings were up, the momentum was obvious."

"How much did I make from all this? Zippo. I didn't buy a single share of any of the financial services companies; not Dreyfus, not Federated, not Franklin. I missed the whole deal and didn't realize it until it was too late. I guess I was too busy thinking about Union Oil of California, just like the doctors. Every time I look at a Dreyfus chart, it reminds me of the advice I've been trying to give you all along: Invest in things you know about."


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