Famed investor Phil Fisher was one of the world’s most stubborn investors. He once held a stock for 49 years until he died.

He bought Motorola in 1955 for $10 and watched it grow 20x, turning every $1,000 invested in 1957 into $2 million.

Phil Fisher founded his investment firm in 1931 at age 24. And for 70 years, he beat the market using one simple rule:

“Buy great companies and never sell.”

If the job has been correctly done when the stock was purchased, the time to sell it is almost never.”

He held Motorola from 1955 to 2004.

His investments made millions by being patient and waiting for compounding to occur.

The biggest enemy in investing, he believed, was the urge to take action which leads to selling your winners too early and disrupting the power of compounding.

With investing, Fisher utilized the “scuttlebutt” method.  He would talk to suppliers, customers, competitors, former employees and others before buying any stock.

Warren Buffett used this exact method in the 1960s with American Express. Buffett believed that “You’ll know more about the industry than most people in it.”

Warren Buffett met Fisher in 1962 in San Francisco. He states that, “I was getting the Fisher doctrine from both sides. It made sense to me.”

Buffett said his investing style is “85% Graham, 15% Fisher.” That 15% is worth over $100 billion today.

Fisher had 15 rules for picking stocks, but one was absolute:

“Invest only in companies where management has integrity.” – Management controls your money. They can benefit themselves at shareholders’ expense. This is the only rule with no exceptions. If management fails, don’t invest.

Fisher shared this investment insights :

Company A pays 5% dividends, grows 7% annually.
Company B pays 2% dividends, grows 26% annually.

After 10 years: Company A dividend = 10% of your original investment.  Company B dividend = 20% of your original investment.

Additionally, Fisher debunked the diversification advice in 1958.

“People over-stress ‘don’t put all your eggs in one basket.'”

Most investors own 15+ stocks they don’t understand.  Fisher owned 4-5 companies he knew completely You can’t properly watch 20 companies with 24 hours per day

Start with 250 companies → Research 50 → screen 3 → Buy 1.

Fisher visited management teams personally before investing.

Fisher looked for companies with natural protection from competition:

-Lower costs when larger

-pricing control

-Hard to copy

-Customers can’t easily switch

-High profitability attracts competition like honey attracts flies.”

You need protection to keep profits.

Fisher’s best research question for competitors:

“Which company in your industry do you fear most, and why?”

If multiple competitors named the same company with respect, that was his target.

When your enemies admit you’re dangerous, you’re probably winning..