The Investor Legends Club
We all dream of the feeling of becoming a legend in our fields of work. While very few experience that feeling, there are countless individuals creating their own legacy along the way. A legend is defined as an extremely famous or notorious person, especially in their field. Legendary status means an individual or group has accomplished something far greater than what has been done and often stands the test of time.
In the investment world, there is a select group of individuals who are routinely discussed for their philosophies of the stock market and their excellent career performance. Many of these investors have earned the credential as a business magnate. Their expertise of the overall economy is often sought out to help either evaluate the future of the economy or what the current conditions are representing.
There are so many investors who have accomplished outstanding feats and are deserving of recognition. Much praise for any investor who has returned an annualized average of at least 20% for over multiple decades.
The investors that have been chosen for the following legends club have both earned a prestigious level of accolades and have cemented their spot as game changers in the investment industry.
Here is the Investor Legends Club
Buffett is considered the most successful investor of all time, due to the amount of fortune he has been able to amass over his career. His company Berkshire Hathaway has grown into a $400 billion global conglomerate. The main principle Buffett lives by is: Buy excellent companies at undervalued prices, and then hold for the long haul as price appreciation kicks in. He believes management effectiveness is one of the most important factors to a successful company. Also, a company must have a competitive advantage in relation to its peers. Only invest in companies that you understand the product or service and what it can do for the world.
Favorite Quote: “It’s far better to buy a wonderful company at a fair price than a fair company at a wonderful price”
As a value investor, he believes the value of shareholders should be number one to a public corporation. However, throughout the investing industry he is often referred to as a corporate raider who seeks to takeover companies with poor management. He believes the change of management will turn a weak stock into an excellent stock. Through managing his own firm on Wall Street he has returned an annual rate of return of 31% over his career.
Favorite Quote: “I like winning. There’s also a certain joy in it. I feel fulfilled by it”
The notably acclaimed manager of the Fidelity Magellan Fund for 13 years, Lynch beat the S&P 500 Index 11 out of the 13 years with an annualized return of 29%. He believes it is a waste of time to attempt to predict the outcome of the economy. Lynch has released two best-selling stock books “One Up on Wall Street” and “Beat the Street”. The premise is outstanding companies are everywhere around us. Products and services we use every day can be the source for discovering the next excellent stock. Be able to explain why you are buying a stock before you make the purchase.
Favorite Quote: “The key to making money in stocks is to not get scared out of them”
We all know Soros as the man who broke the Bank of England. He shorted their currency on what is called Black Wednesday to earn $1 billion in one day. While he was the lead manager of the Quantum Fund, he returned an annualized average of approximately 30%. Currency trading may be his famed area of expertise, but no question Soros has become a tycoon in the overall economy. He does not live by a set of investing strategies; rather he uses a speculative approach.
Favorite Quote: “It’s not whether you’re right or wrong that’s important, but how much money you make when you’re right and how much you lose when you’re wrong”
John “Jack” Bogle
Bogle’s contribution to the investment world is at the top of the ranks for what he has created for the everyday investor. He is the founder of The Vanguard Group. Vanguard is the first and most recognized source for individuals to be able to invest in low-cost mutual funds. He feels investors should be mindful of the cost of money managers. Past performance only should be used to gauge consistency and risk. Also, he informs investors to own a select few strong index mutual funds rather than several funds.
Favorite Quote: “Don’t look for the needle in the haystack. Just buy the haystack”
Fisher is considered the father of growth stock investing. Many people have read the story of Fisher buying stock in Motorola during 1955 and held it until his passing in 2004. His two main categories for evaluating stocks are the characteristics of the management and the business. Qualities for an effective management are accessibility, integrity, clear-cut accounting, a long-term viewpoint, flexibility to change, and strong financial controls. Qualities for a successful business are having a growth direction, high profit margin, high return on equity, a commitment to research and development, superior sales results, industry leader, and propriety goods or services.
Favorite Quote: “If the job has been correctly done when a common stock is purchased, the time to sell it is – almost never”
Templeton is coined as the creator of the modern mutual fund. In the late 1930s, he bought every stock priced below $1, totaling 104 companies. 67% of the companies outlasted 4 years with a total return of 285%. This sparked the idea of diversification. He believed there were always overlooked and undervalued stocks available, but most people gave little attention to them. He thought not learning from your mistakes as an investor will bring serious determent to a portfolio.
Favorite Quote: “The four most dangerous words in investing are: This time it’s different”
One of the greatest strategic traders to cross Wall Street, as he managed short and long-term plays on his way to returning an annual average of 24% over his 28-year tenure. Steinhardt knew investors should gather as much data as possible to position them to be able to identify a change of pattern before the masses could. Also, he felt people should not make small investments. If you are going to put money on the line make sure it was worth the time and effort that was taken to make the investment decision.
Favorite Quote: “Good investing is a peculiar balance between the conviction to follow your ideas and the flexibility to recognize when you have made a mistake”
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