Philip A. Fisher, Influential Investor

October 16, 2009 | scorpion

Philip A. Fisher is considered today as one of the ‘most influential investors’ in the history of the industry. Many of the investment beliefs that he practiced and shared with the rest of the world are still relevant in today’s trading market and they are studied by investors all over the world. His book ‘Common Stocks and Uncommon Profits’ was the first book of its kind to ever make the New York Times Bestseller list and Fisher was probably the last of his breed to find success after the stock market crash in 1929.

Biography

Born and raised in San Francisco California in 1907, Fisher was 27 years old when he decided that college – at the new Stanford Business School – was not for him. He went to work at the Anglo-London Bank in San Francisco as a securities analyst before changing careers to work for a firm that dealt with the stock exchange. He gained his trading experience first hand and in 1931 he stated his own business, Fisher & Company, a money management firm. Fisher played a large role in his business, running the company until 1999 when he retired at the age of 91. It is said that his client’s investment gains were beyond extraordinary but other than his professional career, little is known about this private man.

Claim to Fame

Philip Fisher commented that, “I don’t want a lot of good investments; I want a few outstanding ones.” This sentiment went into his work as an early venture capitalist, private equity broker, advisor to chief executives and his own mentoring of others in the business. He was looked upon as a role model by up and coming investors, and his influence – as well as his trading tactics – helped set up many of today’s policies and practices in the trading and investing industry.

Why was he successful?

Fisher was involved in trading and investing for over 70 years. During that time he developed a system of investing that included long-term investing. It included purchasing company stocks at a reasonable price. He was also very selective about the customers he took on looking for companies to work with in both investing and stock purchasing that were growth oriented, had high profit margins and capital returns, was committed to research and development, lead their position in the industry, were great sales organizations and had proprietary products and services. A good example of his thought process is the Motorola stock he purchased in 1955 that was not sold until he passed away in 2004.

When Fisher invested in a company, it was for the long term. He enjoyed getting his research about the company through the ‘business grapevine’, finding that the gossip circulating around the industry about a company was fairly accurate. He was also a pioneer in networking, using all of his professional contacts to gain whatever information he could on a particular company he was interested in.

His inventions

Fisher’s most famous invention was his fifteen point process of looking at common stock. Divided into two categories, the fifteen points included but were not limited to: integrity in management; conservative accounting; good long term outlook; excellent financial control; good personnel policies; and an open attitude towards change.

Publications

Philip A. Fisher was the author of three books on investing and trading:

  • Common Stocks And Uncommon Profits by Phillip A. Fisher (1958)
  • Conservative Investors Sleep Well by Phillip A. Fisher (1975)
  • Developing An Investment Philosophy by Philip A. Fisher (1980)
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