Choose wisely. There is only one correct answer to each question.
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1.
According to Peter Lynch's classification system for companies, a company that has been beaten down might soon rise again. What kind of company would this be?
Turnaround. Of course, it may not turn around at all, but if it does, its momentum will likely be tied to the overall market.
2.
What was Peter Lynch's favorite investment metric?
P/E ratio. Although he valued several, P/E ratio was his favorite.
3.
How did Peter Lynch feel that we should regard short-term market movements?
We should discard them. Lynch believed in investing for the long haul.
4.
Peter Lynch's investment style is best described as what?
Opportunistic. Lynch took ideas from many different investment philosophies. He went wherever he thought the best opportunities were.
5.
What three fundamental criteria did Peter Lynch use to evaluate a stock?
Profits, business model, and current stock price. Lynch looked for profitable companies with solid business models selling at good prices. He was willing to pay more for those companies than other managers might have paid, and he tolerated debt as long as the profits were there and the business model was right.
