Focus on understanding the business rather than shortterm price fluctuations from "summary" of Common Stocks and Uncommon Profits by Philip A. Fisher
Fisher emphasizes the importance of focusing on understanding the business itself rather than being swayed by short-term price fluctuations. He believes that true investors should be interested in the long-term success of the business they are investing in, rather than trying to make quick profits based on market movements. By taking the time to thoroughly understand the business, its products, its management team, and its competitive advantages, investors can make more informed decisions about whether to invest in a particular company. Fisher suggests that investors should approach investing with a mindset that is similar to that of a business owner. By viewing themselves as partial owners of the companies they invest in, investors can better appreciate the long-term value of the business and avoid being distracted by short-term market noise. This perspective can help investors stay focused on the fundamental strength of the business and its ability to generate sustainable profits over time. In Fisher's view, understanding the business involves conducting thorough research and analysis. This includes evaluating the company's financial statements, studying its industry and competitors, and assessing the quality of its management team. By immersing oneself in the details of the business, investors can develop a deeper understanding of what drives its success and identify potential risks that may impact its future performance.- Investors can make more informed and rational investment decisions. This approach can help investors avoid making impulsive decisions based on market sentiment and focus on the long-term growth potential of the companies they invest in. Ultimately, Fisher believes that by staying focused on the fundamentals of the business, investors can achieve better investment results over the long term.
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