I went through the same process. I wasn't in the market until '96 when I inherited some money. Started out by diversifying in mutual funds: you know, a tech fund, a drug fund, a global, etc. Then I decided individual stocks was the best way. Started with the Dow Dogs, too. Then, I decided on ten diversified ones: 2 techs, 2 drugs, financials, etc., even a REIT.
Now I'm almost 100% tech communication (got to flip that Tyco). Started the year with, and have held EMC and TLAB, added JDSU in April, GBLX in Sept., and QCOM, NTAP (you convinced me into it), and CREE during Dec. Right now I'm debating rolling the TLAB into more QCOM and JDSU.
The Buffet Portfolio really solidified my thinking against the diversification approach, and into a half-dozen or less of the best stocks you can find. I loved it when he said something to the effect: "why put your money into your tenth best choice, instead of one your top three?"
Marc |
