Ha. Well I disagree with all of you! 3-5 stocks or 9-12 say, would be okay for someone really trying to catch the pitch and make a lot (and willing to assume a higher risk IMO). 10-12 positions way too risky for long term patient value investors. Growth investors, maybe okay -- all you need is a couple of Cokes, and MO's and hold the heck out of 'em. For value investors, got to always be planting seeds. Note Mike's portfolio. No stocks reported bot prior to '98. (No time diversification.) Al Frank is not a good example to use -yes, he's associated with buying large numbers of different companies - 75, 100, maybe more - lots of time diversification, biz. divers., but his portfolio results are heavily skewed by large amount of margin. (His example doesn't proove the diversification case IMO.)
Let me ask you pig-at-trough investors. If HWP dropped 25 points for some superficial reason (say the HWP Pres. had a heart attack --- that wouldn't be superficial to him though -g-), what would you do? Sell a position you've researched the heck out of,and have owned for a while, (and so has good prospects per your evaluation) and buy HWP? Substitute a potential better value, for one you already have evaluated? That'd only be okay IMO if you fit in the category in my first sentences above. But for value investors - I believe Graham says one can make an adequate return with value stocks, not necessarily get rich. So if switching, my opinion is that it is not value investing to give up one value stock for another. JMO. Paul |
