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

To: Elroy who wrote (54698)	1/3/2015 2:07:32 PM
From: Paul Senior	Read Replies (1) \| Respond to of 78625

...rather than hold 60 positions in nearly equal weight you are better off just buying an index fund. With that number of stocks I think it is really really really hard to beat an index by more than 2 or 3 percent, and that is plenty hard. Who holds 60 positions of nearly equal weight? I assume most long-term investors have held some stocks for many years if not decades, that may have come to dominate their portfolios. (CHV or BRK maybe being an example of that for some people here.) Other stocks may be recent buys with the buyer only establishing an initial buy or tracking position. Better off just buying an index fund? What index fund would the person be better off buying? The standard S&P? An all stock index? A value index for those who only say they buy value stocks? When I find a sector that seems beat down, I like to buy stocks of several companies within that sector - for example I am still holding several bank stocks, insurance company stocks, refinery stocks, auto companies. I almost always hold over 200 positions in an adult-size portfolio , and I've beat the S&P and Russell 1000 Value. Not the the last couple of years though -- heavy positions in oil/oil service have decimated my results. For me, holding an adult size portfolio which already meets my financial goals, I would find it crazy to put 30% of my savings (portfolio?) into any individual stock. There's just no need. No need to attempt to beat any index either. ... Uh... that said, my competitive juices still flow, and I do take risks that aren't necessary in an attempt to outperform. -- not the smartest thing.