Peter Lynch is regarded as one of the most successful investors of all time, on par with the legendary Warren Buffet. Lynch started his investing career at Fidelity in 1977, managing their Magellan Fund.
He is considered a growth investor, and one of his favorite sayings is, “Always invest in things you understand”. He also coined the phrase “10 bagger”, which refers to a stock that increases in price tenfold.
Peter Lynch is best known for generating an average of 29.2% yearly return during his 13-year stint as a mutual fund manager, outperforming the S&P 500. Peter Lynch is also well known for his philanthropist activities and has donated more than $100 million to education projects through the family foundation.
To answer the question “How much is Peter Lynch worth?” we decided to compile all the publicly available data on Mr. Lynch’s wealth. Below we have provided our best estimate of Peter Lynch’s net worth.
Note that estimates are precisely that and are not in any way conclusive. With the help of publicly available assessments, we can determine a figure that is likely to represent Peter Lynch’s net worth.
|Date of Birth||January 19, 1944|
|Title||Mutual Fund Manager, Investor, and Philanthropist|
|Companies Founded||Magellan Fund|
|Best Known For||Fund Manager, Magellan Fund|
|Net Worth (USD)||$450 million|
What Is Peter Lynch’s Net Worth?
By most estimates we have had access to, Peter Lynch’s net worth is $450 million. This estimate is reported by various sources and seems in line with our own. Most of Lynch’s wealth comes from his days as the Magellan fund manager, as well as personal investing activities.
Lynch took the Magellan fund from managing $18 million in 1977 to managing $14 billion over the course of the 13 years he was at the fund. Considering the salary and bonuses fund managers receive, which are a percentage of fees received, we feel that the estimate mentioned above is likely representative of Peter Lynch’s net worth.
Peter Lynch Biography
Peter Lynch was born in Newton, Massachusetts on January 19, 1944. Lynch lost his father at the age of 10, leaving his mother to take care of the family. However, the grave loss did not stop him from reaching his academic goals.
He graduated from Boston college in 1965, where he studied history, psychology, and philosophy. In 1968, he earned an MBA from the Wharton Business School, University of Pennsylvania.
Lynch used to work as a caddy at the Brae Burn Country Club in Newton, Massachusetts. One of Lynch’s golfers was the CEO of Fidelity Investments, in 1966 Lynch was hired as an intern at the company.
After three years, Lynch was hired permanently. In 1969 he was assigned the position of research analyst. In between, he served in the army, during which time he married his wife, Carolyn Ann Hoff. The couple had a daughter and were together until Carolyn passed away in 2015
Lynch’s career advanced rapidly, and in 1974 he was promoted to assistant director of research. In 1977, Lynch received another promotion and was made fund manager of the Fidelity Magellan fund.
Lynch has also written several books; his most notable publications are 3 books about investing in the financial markets.
- One Up on Wall Street – Peter Lynch with John Rothchild, Penguin Publishing Group, 1990.
- Beating the Street – Peter Lynch with John Rothchild, Simon & Schuster, 1994.
- Learn to Earn – Peter Lynch and John Rothchild, Simon & Schuster, 1996.
How Did Peter Lynch Build His Wealth?
Lynch already had an investor’s mindset from an early age. Instead of spending the cash he earned from odd jobs as a student, he invested $800 in his first investment in stocks. The target was Flying Tiger Airlines, for $8 a share, the stock’s price would later rise to $80 a share.
From his years as a college graduate studying humanistic subjects such as history, Lynch considers these subjects gave him a better understanding of how investing works. For Lynch, investing in the stock market is an art and not a science.
Through his studies at the Wharton School, he realized that all the theories he learned there collided with what he saw his colleagues putting into practice at Fidelity. Of course, he chose to go along with the practitioners rather than the theorists.
When Lynch was put in charge of the Magellan fund, the fund had investments in 40 stocks. Fidelity’s CEO and owner Ned Johnson advised that Lynch should reduce that number to 25. Lynch ignored the advice and eventually the fund had 1,400 different investments.
Lynch also used financial metrics, he has shared the details of some in his books. One metric, which he claims has reaped huge rewards, is comparing earnings per share to the share price. He would compare $1 of earnings to $15 of the share price. When the price line is below the earnings line the stock is a buy and vice versa.
How is Peter Lynch’s Net Worth Calculated?
Peter Lynch’s net wealth must be calculated by estimate, as we do not have publicly available documents about his stock holdings. We considered his time as the fund manager at Magellan fund for 13 years. The fund fees are 0.77% of the assets under management.
As we know, the fund had $18 million in 1977, which equals only $138,600 a year in fees. However, by 1990, the fund had $14 billion in assets, which equals $107,800,000 in fees.
Considering the size of the fund and fees generated, we feel confident that Lynch was receiving multi-million-dollar payouts for his management prowess during most of the 13 years at the fund.
We can also speculate that Peter Lynch has made multiple investments of his own over the decades to determine a figure of $450 million. This figure is an estimate and may not be completely representative of Peter Lynch’s exact net worth.
As mentioned above, Lynch had 13 years at the helm of the Magellan fund, obtaining an average of 29.2% yearly returns and outperforming the S&P 500 index. The fund at some point was investing in 1,400 stocks which is around 5 times the average number of stocks held in a typical mutual fund.
Lynch believed that there was a way to outsmart Wall Street, as his book by the same name goes. He relied on 3 fundamental aspects to make his investment decisions. Firstly, only buy what you understand. If you are not fully aware of what your investment entails, you should avoid it.
Do your homework, study your investment thoroughly, and try to find stocks that Wall Street is currently overlooking. Invest for the long run. It is extremely difficult to time markets, which means you may not be able to predict where a stock’s price will be in 6 months. However, it is much easier to determine where a stock’s price will be in 10 years.
Diversify your portfolio. Lynch was a big believer in portfolio diversification, which we know from the high number of picks he made while running the Magellan fund. However, he also diversified by sector, industry, company size, and growth potential.
Peter Lynch’s View on Alternative Assets
Peter Lynch hasn’t openly expressed his views on investing in alternative assets. However, we do know that he always recommends investing actively and against passive investing. In an interview with Bloomberg Radio, Lynch expresses his opinion clearly in favor of active investing.
In our opinion, anyone who is an active investor must also know that their investment portfolio needs to benefit from a wide selection of assets. Diversification means your risk is split among several assets which reduces your overall risk level.
We also know that Lynch invested extensively in fine art. Artwork is also an alternative investment. Lynch’s philanthropist activities include donations of many pieces from his art collection. His latest donation of artwork to Boston College was worth $25 million.
Who Else Invests Like Peter Lynch?
Not all investors have the same investing style. To compare investors like Peter Lynch you can check out some of the profiles listed below:
- Mary Barra
- Jim Cramer
- John Paul DeJoria
- Arlene Dickenson
- Bruce Flatt
- Joel Greenblatt
- Abigail Johnson
Want to Invest Like Peter Lynch?
To invest like Peter Lynch, you need to first understand what you are investing in, and then determine how much growth potential your investment has. Lynch is a growth investor, consistently searching for investments that could outperform the broader stock market.
You can start your investment strategy and benefit from tax advantages by opening a Self-Directed IRA today. Apart from enjoying tax-deferred growth, with this type of IRA, you will also be able to invest in gold or cryptocurrencies.