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Strategies & Market Trends : Gorilla and King Portfolio Candidates
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To: Eric L who wrote (25517)5/29/2000 6:06:00 PM
From: Brian K Crawford  Read Replies (2) of 54805
 
OT Re: Portfolio restructuring

Eric, thank you for the thorough and thoughtful reply to my post. Your annual rebalancing discipline that reduces all positions to no more than 20% has served you well this year.

You know, until reading here last year about Lindy doing his 100% thing with Q, I never would have given a thought to allowing that kind of concentration in one issue in my personal portfolio.

There are also some reinforcing messages that concentration is OK that come from reading the FM. The advice is to hold onto Gorillas until they are no longer Gorillas or a clear substitution threat appears. If these Gorillas substantially outperform, then these big winners will become overweighted unless you take steps to pare them back.

These messages are floating through my thought process, along with the everyday effort to balance my fear and greed as I approach the markets.

I allocated a relatively normal weighting of my portfolio to Q in April 1999. It became way overweighted by virtue of appreciation. I count my blessings here!

I believe its still a Gorilla.

I know I will give up a sizable chunk of tax to Uncle if I sell.

My amateur valuation work says it has superior appreciation potential from here.

The only reason I can come up with for selling is to reduce risk.

As you can tell, I have some further soul searching to do to arrive at the next step for me. Doing nothing, of course, is a vote for continued concentration, and a decision to follow the advice in the RFM, as I understand it.

For the record, I am not a momentum investor. I am very much a LTB&H investor.

Thanks again for your feedback. Especially the advice on balancing my NTAP with some EMC. This board is a wonderful resource.

Brian

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