Considering Peter Lynch is regarded as one of the greatest investors of all time, it’s not surprising that Peter Lynch’s net worth is substantial. Lynch is the best-selling author of a few books and had a lengthy and lucrative career as a mutual fund manager. But his most notable accomplishment is growing the Fidelity Magellan (FMAGX) mutual fund worth $14 million to an astounding $18 billion in thirteen years.
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What is Peter Lynch’s Net Worth?
In 2006, Peter Lynch reported an estimated net worth of $352 million. According to Boston Magazine, that figure made Lynch the 33rd richest resident of Boston, Massachusetts. Several sources have reported that Peter Lynch’s net worth is closer to $450 million.
How did Peter Lynch Grow His Net Worth?
1. Personal Investments
Probably one of the most fiscally responsible teenagers of his time, Peter Lynch saved his money from odd jobs and invested $800 into his first stock purchase, Flying Tiger Airlines. Lynch purchased the stock for $8 per share, and the stock price would eventually rise to $80.
He used his profit from Flying Tiger Airlines stock to pay for his education. With his first investment in life being such a success, it’s no wonder Peter Lynch was able to amass such a fortune.
Lynch’s investment philosophy was further developed when he worked at Fidelity Investments as manager of the Magellan fund.
2. Investment Fund Manager Career
Peter Lynch’s career at Fidelity Investments began as an intern in 1966. He was offered the internship after working as a caddy for the company’s CEO, as luck would have it. Before being permanently hired in 1969, Lynch returned to school to work on an MBA at The Wharton School at the University of Pennsylvania. He also served in the war for two years and married his wife, Carolyn Ann Hoff.
Lynch’s first role at Fidelity was to follow the mining, textiles, and metals industries. By 1974 he was promoted to Director of Research, and by 1977 he became the manager of the Magellan Fund.
When Lynch first started managing the Magellan Fund, there were only 40 stocks in the fund. At the time, Fidelity’s CEO asked Lynch to reduce the investment to just 25 stocks. Instead, Lynch started increasing the number of stocks in the fund until there were eventually 1,400 different investments.
His confidence in his investment strategies led Lynch to grow the Magellan Fund to a staggering 29.3% average annual return. Over 13 years, this unprecedented average annual return resulted in the Magellan fund growing from $14 million to $18 billion in assets under management. The Magellan fund became the best-performing mutual fund in the world. According to Lynch in his book Beating the Street, some of his most profitable stock picks were Ford, Phillip Morris, MCI, General Electric, Lowe’s, Kemper, Fannie Mae, Volvo, and General Public Utilities.
3. Best-Selling Author
Peter Lynch is a best-selling author and has also coauthored several books. His three best-selling books about investing are:
- One Up on Wall Street, published in 1989
- Beating the Street, published in 1994
- Learn to Earn, published in 1996
One Up on Wall Street alone sold over one million copies.
Overall, Lynch keeps his investment philosophy reasonably straightforward, and the first step is to ‘invest in what you know.’ Lynch emphasizes the need to invest in good companies you understand and have thoroughly- researched. Lynch is also known for coining the term ‘ten bagger,’ referring to stocks that have the potential to earn ten times more than the price it was paid for.
Lynch has always been vocal about his belief that the average investor can outperform the professionals on Wall Street with the proper investor mindset and some homework. There are key financial indicators such as the price-earnings ratio, the growth rate, and an overall solid balance sheet that investors need to learn and understand. However, Lynch believes people don’t need a business school degree to become successful investors.
Lynch also encourages investors to be patient. Investors should commit to a buy-and-hold strategy as long as the companies continue to operate well. Investors should keep stocks long-term and ride out the volatility inherent in the stock market. In fact, Lynch believes that if the stock of a good company drops in price, it’s the perfect opportunity to buy more shares.
Peter Lynch also made famous the stock investment strategy referred to as “GARP,” or Growth At a Reasonable Price. This strategy is a cross between growth investing and value investing. It consists of purchasing undervalued and reasonably priced stocks while considering the growth stocks with the potential for share-price increases.
Peter Lynch’s Net Worth Leads to Philanthropy Work
Peter Lynch put his wealth to good use by creating a charitable organization, The Lynch Foundation. The foundation supports many initiatives in education, hospitals, medical research, and cultural and historical organizations.
Peter Lynch continues to serve on the board of the Lynch Foundation. His experience, intellect, and generous nature to share his wealth and wisdom are all reasons to follow Peter Lynch’s advice and path to success.
You can also read 25 Peter Lynch Quotes You Must Read Before Buying Stocks by the same author.
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Nadia Tahir is a freelance writer and content creator. She mostly writes in the areas of lifestyle and personal finance. She also enjoys writing on her blog about motherhood at This Mom is On Fire.