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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (13374)	11/26/2001 11:06:12 PM
From: Mark Marcellus	Read Replies (2) \| Respond to of 78473

He's said, know as much about a company as you can - the individual investor ought to be able to follow 5 stocks (or was it more?) very well, and that might be all the investor needs, if I recall Mr. Lynch comments correctly. OTOH, when you read about how he managed his funds, they were broadly diversified Lynch is pretty consistent in what he says. He believes you should stay concentrated in a few companies you know very well, unless you have the entire Fidelity Research Department backing you up, or unless your total AUM is hundreds of millions or more. (And if you're going to do the latter it is imperative that you have the former, or its equivalent).

To: Paul Senior who wrote (13374)	11/27/2001 10:05:06 AM
From: Bob Rudd	Respond to of 78473

Number of stocks is far less important than minimizing overlapping business and market risk....selecting stocks [and other assed classes] that aren't highly corellated with each other. International exposure used to be a good approach, but anymore, other than Japan, they all seem to dance together. I would agree that Lynch's method, as applied by most individuals, would result in over concentration in sectors the investor has competence in. I beleive it's better to use funds in areas the individual is disadvantaged vs the professional in individual stock selection...such as emerging markets.