Choose wisely. There is only one correct answer to each question.
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1.
If you are interested in buying into a company because of one specific product, what would Peter Lynch's advice to you be?
Make sure that the product is a meaningful percent of sales. Otherwise, there isn't much sense in keeping an interest in the company.
2.
Which of the following was not a part of Peter Lynch's stock-picking approach?
Focus on the market and the short term. Lynch argues that the stock market is completely irrelevant. Moreover, he thinks that it is impossible to predict what stocks will do in the short term and recommends investing only for the long run.
3.
According to Peter Lynch, what are the big winners in the stock market?
Fast growers. These companies have the biggest potential for growth, along with a lot of risk.
4.
What sorts of companies did Peter Lynch favor?
Those in industries he understood. Lynch invested in those in industries he understood. Lynch firmly believes that you should invest only in what you know. He shunned industries he didn't understand, even if they presented great value or great possibilities. Notice this echoes Warren Buffett's "circle of competence" idea.
5.
Companies whose sales and profits rise and fall in a regular fashion are called _______.
