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Common Stocks and Uncommon Profits and Other Writings summary
Philip A. Fischer
Improve your investment strategy
18 mins
Brief summary
Common Stocks and Uncommon Profits and Other Writings by Philip A. Fischer is a timeless guide for investors on how to identify unique and promising opportunities in the stock market, focusing on long-term growth, financial strength, and management quality to achieve uncommon profits.
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Common Stocks and Uncommon Profits and Other Writings
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Key idea 1 of 8
Smart investment strategies focus on companies with long-term growth potential.
The common perception of investing is that it is fast-paced and brutal, with investors buying and selling seemingly on a whim, seeking quick profits above all.
Yet smart investing involves much more thought and planning, and is ideally focused on the long term. Smart investors don’t seek quick profits but instead looks for companies with growth potential that over time will multiply an initial investment.
It isn’t easy to identify which companies offer this kind of growth potential. Indeed, many stocks are either over- or undervalued, which can make investing difficult.
Smart investors look for companies with potential that are nonetheless still undervalued, as such companies can, when the time is right, grow with such rapidity that an investor can double or even triple his initial investment.
Luckily, companies with growth potential can be recognized by their common characteristics.
Such companies offer products and services that ideally could sustain high sales volumes for at least a few years. Companies with good growth potential also invest in research and development, to continue growing even when a current product line no longer offers opportunities for growth.
The 1950s, for example, was a great time for television manufacturers. But by the middle of the decade, nearly everyone who wanted a black-and-white TV already had one. This meant that, until the color television was developed, TVs companies faced flat growth; so they had to adapt.
Motorola, now known for mobile phones, used to produce televisions and radios. But management had the foresight to harness the company’s technical skills and experience to enter the two-way communication business, and continued to grow sales while other TV manufacturers’ sales flatlined.
Companies with high growth potential also have a solid management team and good employee relations. Don’t invest in a company whose employees are too busy squabbling to be productive, and whose executives can’t inspire solidarity or a shared vision in the workforce.
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What is Common Stocks and Uncommon Profits and Other Writings about?
Common Stocks and Uncommon Profits gives you all the information you need to make smart investments, regardless of your investment style. Whether you’re looking for huge profits or simply to maintain existing funds, this book shows you the path to success.
Best quote from Common Stocks and Uncommon Profits and Other Writings
Common stocks are usually of greatest interest to people with imagination.
—Philip A. Fischer
Who should read Common Stocks and Uncommon Profits and Other Writings?
- Investment advisors and financial consultants
- Students of finance or economics
- Stock market investors who want to improve their investment strategy
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