Diversified versus focused approach to investing

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(03-02-2013, 06:29 PM)VestedInterest Wrote:
(03-02-2013, 01:21 PM)VestedInterest Wrote: Basically, it's between a Peter Lynch or a Philip Fisher approach. For an amateur like me, I would prefer the former approach, a diversified portfolio. The number of stocks one holds will be a function of the amount of investable money one has and time taken to invest.

I counted nearly 100 companies- subsidiaries and minority holdings, held by Berkshire Hathaway. So it is not true that Warren Buffett prefers a focused approach, perhaps owing to the fact that Berkshire has grown into a huge company. He may have started out 'focused' but with time and more money, became diversified. Hence, I believe if one is long enough in the stock market and invests with discipline and regularly, it is inevitable that one's portfolio will become diversified eventually.

Focus approach should not be defined ONLY by number, but also the weight-age.

I did not count Berkshire Hathaway's holding companies and subsidiary. I assume high weight-age should be focus on just a faction of the 100.
“夏则资皮,冬则资纱,旱则资船,水则资车” - 范蠡
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RE: Diversified versus focused approach to investing - by CityFarmer - 03-02-2013, 08:02 PM

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