There’s a regular topic of conversation in investing circles around managing a diversified portfolio and how many stocks an investor should own to be sufficiently ’diversified’. The general consensus seems to be that portfolio diversification runs on a spectrum of portfolios with 10 or less stocks being super concentrated ’high risk, high return’ and 40 […]
A few years ago, I wrote a blog about the importance of developing your range of knowledge. Since then, my consumption of news and social media content has shot through the roof. Anyone who knows me well will know that my appetite for new, high-quality information is vast I can usually be found poring over
In part three of this series on when to sell, I’m going to explore more concepts that help me to decide when to liquidate a position. You can find parts one and two linked here. The grass is greener on the other side The first of these is undoubtedly when I identify a better opportunity
Half way through writing part one of this series, I realised that this is actually a much more complex issue than I can do justice to in a single article. As such, I’ve decided to split the topic into a series. In the first article, I covered my thoughts on selling; as a first rule,
If asked, I generally describe myself as a ‘buy and hold’ investor. The buying bit is mostly easy – I enjoy looking for good quality or undervalued assets and acquiring them. The ‘holding’ bit is where it all starts to get a bit tricky. I’m fairly averse to selling assets. The amount of work that
Last week, I wrote a post about portfolio management and signalled my intention to cover some of the elements in more detail in further posts. Since then, I’ve been thinking about the psychology of investing – I’ve written fairly extensively about the qualitative and quantitative analysis I do on companies, but relatively little about the
The key building blocks of my approach to portfolio management are to keep risks tightly managed and to develop an easy to follow method of identifying opportunities to buy and sell. I try to keep these goals at the forefront of my thinking to tilt the odds of making money in my favour. When I
I forget where I first heard the quote, but several years ago, I was watching a video with Charlie Munger and Warren Buffet where one of them said something to the effect that “Diversification is for people that don’t know what they’re doing”. It was a typically astute observation from the duo, and it made
Your portfolio is about preserving capital in the short-term and achieving capital appreciation in the long-term. In addition to this, you might seek to produce some level of income but these goals can often feel complicated and obscure to achieve. So how do I go about it? When pursuing these goals, I find looking at
Earlier this week I was alerted to a story about everyone’s favourite electric car company Tesla and their ‘interesting’ approach to the on-going financial black hole that represents their balance sheet. Despite declared a loss every quarter since they were founded in 2008 (yes, that’s right, ten years ago), this is a stock that has
The house of cards that is the Tesla balance sheet Read More »
I was watching a video of the 1996 Berkshire Hathaway shareholder meeting where a member of the audience asked Warren Buffet where Berkshire kept their cash. If you watch the clip you might get some amusement from Warren casually stating “we have a billion and something in treasuries, and a little something extra in commercial
Corporate bonds, or financial obligations owed by companies, have been increasingly year on year for a long time now. A few months ago, a fellow investor pointed out to me the growing issue not just of net bond values in issue, but the grade of those bonds. How are bonds graded? Bonds – both corporate
On the 30th January, the Financial Conduct Authority published two papers as part of a process to propose new measures on encouraging effective corporate stewardship for investors. As an investor myself, I was pleased to read that the FCA is trying to encourage asset managers to more closely monitor the companies they invest in and
Having previously written about the serious danger presented to UK investors by the crisis of credibility facing the UK’s audit industry, I’m yet to see any serious measures taken to suggest this beyond an attempt to drive ‘competition’ in the industry. Why are authorities not undertaking a wholesale review of the effectiveness of auditing? Late
More competition won’t change the culture of auditing Read More »
If you consider yourself an investor then no doubt you’ve heard the story of ‘Mr Market’ – the emotionally unstable, totally illogical neighbour that comes to your house and offers to buy your shares or sell you new ones at a different price every day. Some days, he offers a high price and other days
