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To: Paul Senior who wrote (2460)	11/15/1997 1:34:00 PM
From: Michael Burry	Respond to of 78625

Great post, Paul. Those are exactly the practical problems of a concentrated portfolio. Academics don't always translate into practice, of course. Thanks for pointing that out. I've been running a very concentrated (4-6 stocks) portfolio, but now am moving to a 9-10 stock (goal) portfolio diversified across industries. By diversifyin across industries, I am still picking the best deal in each industry and therefore running a concentrated portfolio with less risk. But the practical problems that you mention are exactly what I deal with. In the vein of natural talents, could it be that person A's natural talent may be in a concentrated portfolio, person B's is in a diversified portfolio, and that's the way it should be for each to maximize his/her returns? "Know thyself and follow your talents," maybe? Good Investing, Mike

To: Paul Senior who wrote (2460)	11/15/1997 7:29:00 PM
From: jeffbas	Read Replies (2) \| Respond to of 78625

As I have said before on this thread (I believe) the average person should only buy index funds. The above average person who wishes to invest in individual stocks can not hope to understand a great many companies or industries. I think that it is perfectly appropriate for such a person to limit himself to the 9-10 stocks mentioned by Mike, and force himself to evaluate each new idea against every one of them. I would suggest that anyone still concerned about diversification obtain it by adding index funds rather than an unmanageable number of stocks.