The Toll of Being the Best

ON THE HORIZON HISTORY LESSONS The Toll of Being the Best BY GLENN RIFKIN he only thing more startling than Peter Investment wizard Lynch’s run on Wall Street may have been Peter Lynch’s remarkable run his decisionT to walk away. It was 1990, the height of the bull run only demanded more. on Wall Street, and at the age of 46, the man who had built the most successful mutual fund in mate, inducing one of every 100 to Marcus, as his success grew, so the world decided to call it quits. Americans to invest in Magellan. did the freedom Fidelity gave him In doing so, he made it clear that Fidelity, for its part, saw its to be bolder and make bigger bets success for any leader can also fortunes soar, from assets of $4.8 inside the Magellan portfolio. have its burdens. billion to more than $114 billion, Many thought Lynch’s genius For those under 40, the name as it helped convince millions of at identifying companies whose might not ring a bell. But Lynch’s Americans that the stock market stock was poised to skyrocket bespectacled, white-haired could carve a path to retirement. was all about following his gut. image, so prevalent “His perfor- In fact, his success was fueled by on cable business mance was really a yeoman’s appetite for research channels in the ’80s, How extraordinary,” and analysis of every company might. A fund man- He Changed said Alan Marcus, a whose stock he acquired. ager at a time when the Game professor of finance Still, Lynch’s decision to retire mutual funds were at Boston College’s at such a young age shocked not yet on the radar Carroll School of Fidelity and the investment com- % of most individual 29 Management. “I munity. Over time, it appears investors, Lynch ANNUAL RETURN doubt what he did that the pressure to maintain his put together one of OVER 13 YEARS could be duplicated unprecedented level of success Wall Street’s most today.” simply grew to be overwhelming. remarkable winning HE GREW THE Sustained suc- He told The Wall Street Journal streaks, turning the MAGELLAN FUND TO cess at the top of at the time that he needed to Magellan Fund into $14 BILLION the game is rare—in spend more time with his family a $14 billion behe- sports, in politics and on other personal interests. ONE OUT OF EVERY moth and helping 100 AMERICANS and in business. Being a winner for so long took a transform investing INVESTED What Lynch ac- physical and emotional toll. as we know it. IN MAGELLAN complished under “Since 1982, I’ve worked every During his 13- the harsh glare of Saturday,” he told the Journal. year tenure, Lynch public fascination “The last 18 months, I’ve been provided investors a staggering and scrutiny still shocks investing working Sunday mornings 29 percent average annual experts today, decades later. Like before church.” Citing his dad’s return, outperforming the star athletes who rise to hall of early death (at age 46, no less), Standard & Poor’s Index 11 out fame levels, Lynch was a risk- Lynch said he had no interest of 13 years and, by his own esti- taker who didn’t flinch. According in working himself to death so 16 Briefings On Talent & Leadership Peter Lynch, in front of a chart showing his fund’s gains. young. He said that when his sift through to decide what to investor, serving on Fidelity’s doctor asked what he did for hold. Add the travel schedule, board in Boston and devoting regular exercise, “the only thing meeting with managers, reading most of his time to philanthropy. I could come up with was that I through financial reports. It’s He also mentors young Fidelity floss my teeth at night.” really overwhelming.” What’s fund managers. Looking at to- To be sure, his last few years more, Marcus added, Lynch did day’s investing world, he recently grew exhausting. As the fund all this without the benefit of the said in an interview that the got bigger, the burden increased Internet, sophisticated financial greatest change in the industry to find places to invest and software and a tsunami of finan- today is the “deluge of data the media began to question cial data at his fingertips. analysts must process” to run a whether Lynch could continue What Lynch set off at Fidelity fund. He recalled having to wait his successful run. Like the red is still being felt today, more for the quarterly earnings report cape to the bull, such a challenge than 25 years after he retired. from Nike to arrive in the mail only fueled Lynch to keep going, Fidelity is the world’s fourth- and peruse it to decide whether until he couldn’t. largest mutual fund and finan- to buy more stock. “Unless you “The pressure became enor- cial services firm, with more were a Nike shareholder, you mous,” Marcus said. “In the best than $5 trillion in customer weren’t going to get that letter,” of circumstances, that is a brutal assets, and serves more than 25 Lynch said. “Now when they job. Think about how many million individuals and nearly report quarterly earnings, it’s companies the fund is holding 20,000 businesses. webcast all over the planet and and how many others he had to At 71, Lynch is still an active anyone can get a transcript.” • Issue No. 29 17.

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