Warren Buffett? Peter Lynch? Allan R. Stuart? Anonymous?
Question for Quote Investigator: When a stock in your portfolio goes up it is tempting to sell it and lock in profits. Also, when a stock is languishing it is natural to hold on to it with the hope that someday it will ascend. However, a vivid metaphorical adage says this is foolish behavior. Here are four versions:
(1) Don’t pull your flowers and water your weeds.
(2) You shouldn’t cut your flowers and water your weeds.
(3) Be careful you don’t pick your flowers and water your weeds.
(4) Don’t garden by digging up the flowers and watering the weeds.
This saying has been attributed to super-investor Warren Buffett and successful fund manager Peter Lynch. Would you please explore this topic?
Reply from Quote Investigator: In 1989 Peter Lynch with John Rothchild published “One Up On Wall Street: How To Use What You Already Know to Make Money in the Market”. The book warned against flawed investment strategies. Boldface added to excerpts by QI:[1]1989, One Up On Wall Street: How To Use What You Already Know to Make Money in the Market Peter Lynch with John Rothchild, Chapter 16: Designing a Portfolio, Quote Page 245, Simon and Schuster, New … Continue reading
Some people automatically sell the “winners”—stocks that go up—and hold on to their “losers”—stocks that go down—which is about as sensible as pulling out the flowers and watering the weeds. Others automatically sell their losers and hold on to their winners, which doesn’t work out much better. Both strategies fail because they’re tied to the current movement of the stock price as an indicator of the company’s fundamental value.
QI believes that the modern versions of this adage evolved from Lynch’s statement.
Below are additional selected citations in chronological order.
Continue reading “Don’t Cut Your Flowers and Water Your Weeds”
References
↑1 | 1989, One Up On Wall Street: How To Use What You Already Know to Make Money in the Market Peter Lynch with John Rothchild, Chapter 16: Designing a Portfolio, Quote Page 245, Simon and Schuster, New York. (Verified with scans) |
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