To have a diversified basket in BT investing is necessary for survival. Still, I think this would be the time to be snug up against the higher limit of concentration, observing the obvious: concentration is the road to building wealth, diversification to preserving it. Where we now sit, surrounded by intense price compaction, is a springboard to wealth building. It sounds absurd, quixotic, but I believe anyone starting a BT fund today loaded with high quality juniors will be anointed a prescient, fearless media hero in 5 years.
This is the time to be making well considered changes to portfolios. The fortunes of these companies change abruptly, with long term effects on value. And over the last 18 months of sell paralysis a lot of long term, fundamental damage has been done; and a change in sentiment will not necessarily bless all, if any, of yesterday’s hopefuls. When new money comes to the sector, it will take a new look at the landscape. The new money might even be placed by those without experience in the sector or who are within 5 years of wearing braces—they are not going to be picking through the train wrecks. New sector money will be looking for sex, it will as usual be placed primarily by teenagers after all.
(Unless, of course, the NAZ drops another 20%.)
Just some stray thoughts. |
