How I Invest, Part 3: Keep It Simple

(credit: Ed Schipul via Flickr)

(credit: Ed Schipul via Flickr)

Peter Lynch in his book, One Up On Wall Street: How To Use What You Already Know To Make Money In The Market, came up with 21 of what he called “Peter’s Principles,” many which I took quickly to heart.

Since I’ve been thinking about that book again, I wanted to focus today on a few of my favorites principles for investing.

What I deem is the principle of the principlesKeep it Simple Stupid (KISS) — has become my number one guiding rule to investing.

There are way too many options when it comes to where I could put my money these days, and my mind muddles quickly. Investing in what I know and like — while ignoring those investment opportunities that I don’t yet understand — has done me well.

Peter Lynch says that if you can’t explain a company (and, I add, a financial concept) with a crayon, stay away.

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