How many individual stock holdings do you feel is too many? What is your ideal number, assuming a 100% stock portfolio?
Mark Taylor: I have 10. I scaled back from 12 at the end of 2017. I believe that if you have many more than 10, you can’t really keep up with the research needed to know your companies. Just my 2 cents.
Axel Gely: Totally agree
Harris T. Andoko: i have 8 in my porto,and to me 10 to 15 is enough 🙂
Vincent Regan: I have 30 of them Can you be in that yeah I think you could do that many if you wanted to there is an much you can do about a loser most of the time I made about $1700 a day all last week come Friday I lost 2000 for the day it opened Down $1.50 so there’s not much I can do about that so that put me down $1500 right from the bill so that’s the way the Ball bounces easy come easy go
Hoda Mehr: I have about 50 now! I don’t think there is an optimal number. It’s personal. I also don’t really trade. Buy and hold until that company stays a good company. So, it’s not difficult for me to track and make sure My Portfolio is healthy.
James MacThorton: I have 52, and since I go long on everything, I don’t think it’s a big deal.
Milos Markovic: Well it also depends about how much money you have. The bigger the diversification and the lower is the gain, and you then have fees and so on. I’d say 7 to 10 stocks for each 100k you have.
Emily Patterson-Kane: I keep my non-hold positions on an account with no fees
Milos Markovic: I’m not really a fan of overdiversificatio. I like to keep the focus on few good stocks
Chris Calabrese: I have over 100. I guess you can say I run my own mutual fund LOL. Like Hoda, am not a trader and generally aim for a very very long holding period. The majority of my holdings are more mature companies and do not have to be watched as closely as say a small cap growth co.Almost all of my holdings pay me a dividend as this is part of my strategy. Also am a deep value investor
Anne Liu Ratanavong: Oh seeing this makes me feel better since I have too many…
James MacThorton: I like your style, Chris Calabrese!
Brian Locke: I’m in about 22 individual stocks that I “play”. This does not include my managed qualified and unqualified accounts. I do find that for positions you are watching your self too many you can’t really keep up with the homework.
Emily Patterson-Kane: I don’t see why any number would be too many if you have the time to check on them periodically. I have maybe 40 single stocks and 25 funds
Eric Čuka: You don’t want to know my number. I’ll leave it at that. ???♂️
Brian Locke: Ok, folks with real high numbers….just curious how you see that as beneficial? I get diversity but wouldn’t that level of diversity be better served by funds that have managers who can handle the level of homework needed? Individual stock risk/benefits get kind of lost in an overall portfolio of those numbers. Right now at 22…it is much more than i can reasonably track changes in management, financials, development etc. I’ve been focusing on pairing those down to the best few of each of there sectors and then maybe a few for spec. I gotta know the tricks folks are able to use to stay on top of these
Emily Patterson-Kane: Most of my investments are long, I research them maybe twice a year. Not difficult.
Eric Čuka: I’m not saying it’s the norm, or that it’s right. Every investor has his or her own approach that works for them. I have lots of reasons, but it’s not important to list them all. It depends a lot on how much time you have and the amount invested. Mos…See more
Mark Taylor: yep. Lots of different strategies work. Picking the one (or couple) that fits your style is the way to go. No wrong way.
Brian Locke: To me long term is fine but you need to regularly be evaluating you companies to make sure fundamentals that made you by them remain in tact and there is not a better alternative who is beating your stock in their sector. These are just pieces of paper…they aren’t children 😉
Eric Čuka: Children are much more complicated. ?
Brian Locke: Yes…and your children you should be attached to….not pieces of paper in a company….pieces of paper in a company you should be able to let go when something better comes along
Eric Čuka: Brian Locke I don’t disagree. I’m not sure why you are hostile. Everything I’ve said I have agreed with you.
Brian Locke: Sorry you took it as “hostile” EricČuka….it wasn’t remotely intended as such. I thought your comment was humorous. Sorry if my comment was misunderstood
Linda Brown: I have 20 companies in a well diversified portfolio. It depends on having the time to research each one fully…which I do hours of homework on each company periodically!
Chris Calabrese: I’m very diversified across various sectors probably slightly over weight in equity REITS but generally like to focus on Blue Chip companies trading under their fair market value. My goal is to increase my dividend income Y over Y and along with that comes stock price appreciation.
Kerem Oner: Depends on your time and the sector diversification. You need to at least casually follow sector as well as company news so that you can realign your positions as need arises.
Charles Rogan: I don’t do anymore than 4 at a time….helps me stay focused. The “Nicholas Darvas” way.
Helen Sriubiskis: I have about 56 Canadian stocks, and 28 US. The US includes 3 ETFs. I am in Canada. However, the general guideline is; no more than 5% in any one stock/security. Therefore, 20 would be the recommended number.
Brian Locke: That “5%” rule of thumb does not meant by equity asset….its by portfolio assets including cash, bonds, commodities and cash alternatives, real estate, etc. Still so you if you try to follow these rules you have to be very careful to look at any funds you own. I think when you go for such significant diversity to avoid or limit individual stock risk you would sleep better and create less work by diversifying through a fund. Keep in mind the Dow has just 30 components….an S & P fund would give more diversity
Brian Locke: Keep in mind as well these “rules” were created by brokers years ago as ways to create more income selling stocks and the more you owned the more winners they could point to as they redirected you out of losers. Numbers game for them
Allen Kaplun: more than you can monitor at any given time frame is too many. Some can keep track of 3 stocks while others keep track of 300 stocks. Up to you.
Vincent Regan: Pretty exciting to own 30 stock and have 24 in the green some days
Christopher Hong: I feel like a really serious individual should not have more than 6 at any point. Even 3 will suffice.
Eric Čuka: “Serious”? What do you mean by that? I completely disagree. So if you have a million dollar portfolio, you’d risk 33% of your equity portion in three individual stocks? I think I’d prefer to spread the risk around.
Christopher Hong: Risk is what you don’t know. Being particularly confident that 3 companies will not fail is much less risky than being not as sure about 20-50.
Christopher Hong: If you don’t know enough, then you just invest in a market fund like the S&P 500, which is quite well diversified.
Eric Čuka: Christopher Hong you are ignorant if you really believe you are in complete control. 3 stocks is atrocious advice. Nobody said anything about 20-50. Every investor is going to be different. I can understand the “max 10 stocks” rule, but 3 is just idiotic, assuming you have real capital.
Emily Patterson-Kane: Even serious people exist in more than one type and strategy
Emily Patterson-Kane: Christopher Hong risk is higher with less diversity, that is just a mathematical reality of sampling
Hoda Mehr: In the end, there is no rule. Each investor is different in terms of strategy, time, interest and goals. You can’t really generalize and give one number as a golden rule.
Mark Taylor: I think 3-6 is good if you are a trader. But for long term investing, I makes you a bit light on being diversified.
Emily Patterson-Kane: If we are talking super short trades you can’t sit and watch, sure… but that is not how it is phrased. And even then some people can do more
Roger Garrett: The notion that the threshold for owning stocks rises the fewer you have just doesn’t wash. Risk is not necessarily what you don’t know but what you know for certain that isn’t true. You will diversify away risk the more stocks you own – that is a giv…See more