Peter Lynch: Active investors losing out on passive investing

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Peter Lynch: Active investors losing out on passive investing

Peter Lynch says that people who have gone all in on passive investing are losing out.

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The move to passive is a mistake, said the former Fidelity Magellan fund manager, in an interview with Baystate Business, Bloomberg Radio. Our active guys have beat the market for 10, 20, 30 years, and I think they will keep doing it.

He cited three current Fidelity managers as proof of that: Steve Wymer of the Growth Company fund, Will Danoff of the Contrafund and Joel Tillinghast, who are planning to retire from the Low-Priced Stock fund.

The stock-picking prowess of the three men made Lynch, 77, famous and his investors rich, making them the most popular mutual funds among Fidelity s most popular. He produced an annualized return of 29% in his 13 years at Magellan.

Lynch, who increased Magellan's assets under management from $14 million to $18 billion, made a statement in an interview about his latest gift to his alma mater, Boston College.

The money manager is donating 27 paintings and three drawings worth more than $20 million from his and his late wife Carolyn's private art collection to Boston College's McMullen Museum of Art, according to a statement from the school.

The collection includes works by Pablo Picasso, Winslow Homer, John Singer Sargent and Mary Cassatt. Lynch said his interest in collecting began at a younger age with baseball cards and stamps.

In the statement, Lynch, a 1965 graduate of Boston College, said that all students can learn from this collection, which includes a variety of styles of painting, many of which depict the natural beauty of our country.

The donation includes $5 million for the ongoing curation of the Carolyn A. and Peter S. Lynch Collection. Boston College said the total gift was one of the largest in its history. The exhibition is expected to be ready for viewing by September, Lynch said.

Lynch works part-time as a vice chairman of Fidelity Management Research Co., mentoring young analysts and focusing on his philanthropy, including giving through the Lynch Foundation. He retired from Fidelity in 1990 at the age of 46.

Lynch isn't focused on the fund-management business - or whether a stock-picker is likely to beat his record returns.

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