PMT Forum
How do you want to make money today?

Ideal Number of Stock Positions

prnd32 · 17 · 4567

prnd32

  • Forum Master 300
  • ***
    • Posts: 369
    • Likes Received: +0/-0
on: Aug 09, 2012, 11:21 AM
What is the ideal number of stock positions one must hold at a given time?


TSO

  • PMT Idol 1500
  • ****
    • Posts: 1,639
    • Likes Received: +1/-0
Reply #1 on: Aug 09, 2012, 01:05 PM
The answer ultimately depends on how comfortable you are with the degree of diversification. I am personally comfortable with holding no more than ten to fifteen companies at a time, even though traditional finance enthusiasts would tell you it doesn't provide any "diversification protection".

From the traders' perspective, it probably has something to do with your ability to keep track of an open position and do something whenever the market acts "out of the norm". For example, take the so-called "Iron Condor" strategy with options (something I just learned today at work). In a nutshell, it's two vertical spreads on two opposing positions, which profits from the volatility of the underlying stock price within a prescribed range BUT is exposed heavily to catalysts that can cause leaps or freefalls in the stock price.

If you can keep track of multiple Iron Condors, vertical spreads, naked options, etc, ON TOP of actual share ownership, all without going crazy from the uncertainty, then you're comfortable with the degree of diversification. The next question you have to answer is how much risk you're willing to take by concentrating your portfolio into a select few.


bauer

  • VIP 4500
  • *****
    • Posts: 4,857
    • Likes Received: +12/-0
Reply #2 on: Aug 09, 2012, 02:26 PM
What is the ideal number of stock positions one must hold at a given time?

Any number that you can monitor preferably on a daily basis and check their financial reports (quarterly basis) with consistency.

Sa local stocks, for me it ranges between 5 to 8 only. mas konti, mas kontrolado.


prnd32

  • Forum Master 300
  • ***
    • Posts: 369
    • Likes Received: +0/-0
Reply #3 on: Aug 09, 2012, 02:38 PM
The answer ultimately depends on how comfortable you are with the degree of diversification. I am personally comfortable with holding no more than ten to fifteen companies at a time, even though traditional finance enthusiasts would tell you it doesn't provide any "diversification protection".

From the traders' perspective, it probably has something to do with your ability to keep track of an open position and do something whenever the market acts "out of the norm". For example, take the so-called "Iron Condor" strategy with options (something I just learned today at work). In a nutshell, it's two vertical spreads on two opposing positions, which profits from the volatility of the underlying stock price within a prescribed range BUT is exposed heavily to catalysts that can cause leaps or freefalls in the stock price.

If you can keep track of multiple Iron Condors, vertical spreads, naked options, etc, ON TOP of actual share ownership, all without going crazy from the uncertainty, then you're comfortable with the degree of diversification. The next question you have to answer is how much risk you're willing to take by concentrating your portfolio into a select few.

Thanks TSO. I assume the figures you mentioned are for full time traders, isn't it?   If I have a day job and if I am just starting to trade/invest, how many is ideal?  


pmtmember

  • PMT Idol 1000
  • ****
    • Posts: 1,442
    • Likes Received: +0/-0
Reply #4 on: Aug 09, 2012, 03:51 PM
as long as you can monitor it kahit ilan. for me, max ko yata was just 10?


decapolis

  • Forum Tambay 200
  • ***
    • Posts: 253
    • Likes Received: +0/-0
Reply #5 on: Aug 09, 2012, 04:10 PM
Any number that you can monitor preferably on a daily basis and check their financial reports (quarterly basis) with consistency.

Sa local stocks, for me it ranges between 5 to 8 only. mas konti, mas kontrolado.



Warren Buffett would agree on Bauer, according to him:

"Unless you are going to have an extra intensity to the game, in which diversification is an extreme mistake.
You only need to know 6 businesses, really well. Knowing a 7th may bring you down. Lot of people have got rich on there best idea.
Probably have half it in his best."


TSO

  • PMT Idol 1500
  • ****
    • Posts: 1,639
    • Likes Received: +1/-0
Reply #6 on: Aug 10, 2012, 01:55 AM
Thanks TSO. I assume the figures you mentioned are for full time traders, isn't it?   If I have a day job and if I am just starting to trade/invest, how many is ideal? 

Even one is "ideal" if you devote a LOT of time courting the business. :)


decapolis

  • Forum Tambay 200
  • ***
    • Posts: 253
    • Likes Received: +0/-0
Reply #7 on: Aug 10, 2012, 07:48 AM
Sir TSO may time ba na 1 stock lng nsa portfolio mu?


TSO

  • PMT Idol 1500
  • ****
    • Posts: 1,639
    • Likes Received: +1/-0
Reply #8 on: Aug 10, 2012, 09:03 AM
Yeah. Every time I first enter a market. Philippines, edc muna. Usa, alv muna.


prnd32

  • Forum Master 300
  • ***
    • Posts: 369
    • Likes Received: +0/-0
Reply #9 on: Aug 10, 2012, 09:16 AM
Yeah. Every time I first enter a market. Philippines, edc muna. Usa, alv muna.

sir OT question lang po.. do we have a thread here in PMT on how to enter the US and other markets?


TSO

  • PMT Idol 1500
  • ****
    • Posts: 1,639
    • Likes Received: +1/-0
Reply #10 on: Aug 10, 2012, 09:22 AM
Iirc we do. But if I were you, look up e*trade and ask how you can be a part of it despite being a foreigner. You might have to sign up for an ITIN thru the IRS before being eligible though.


chaaar

  • Newbie
  • *
    • Posts: 5
    • Likes Received: +0/-0
Reply #11 on: Aug 29, 2012, 05:09 PM
ideal number is 4-5 so you can closely monitor it :)


asyong21

  • Probie
  • **
    • Posts: 12
    • Likes Received: +0/-0
Reply #12 on: Apr 12, 2014, 10:45 PM
Around 6 maybe....
2~3 for longterm, then 4~3 for short term or regular trading....


GIG

  • PMT Idol 1000
  • ****
    • Posts: 1,359
    • Likes Received: +7/-0
Reply #13 on: Apr 13, 2014, 01:40 PM
One time I had almost 30 stocks in my portfolio but the right number depends really on you. Me, I put the limit when I have to make time checking my stocks and sacrificing the time when I'm doing the things I like in life. Luckily, checking out stocks is one of the things I like to do in life hehehee!


kulatir

  • Forum Master 400
  • ***
    • Posts: 477
    • Likes Received: +0/-0
Reply #14 on: Apr 16, 2014, 10:40 PM
I choose two stocks in every sector. One is blue chips and the other was from 2nd or third liner. I will hold these for long term and see which of them is more profitable.


 


PMT Shoutbox

Refresh History
  • Post only questions or comments here. Advertisements NOT ALLOWED.
  • oragon: :applause:
    May 20, 2019, 03:53 PM
  • FutureGizmo: Thank you for reporting those spam posts, oragon! Spam posts now deleted.
    May 20, 2019, 01:59 PM
  • oragon: Admin kindly monitor some peps! posting and sharing inappropriate nude photos and website links
    May 20, 2019, 01:52 PM
  • @culinary10: Hello I am new here! Regarding sa bdo life insurance for 8 years, pwede pa kaya ma refund yung binayad ko na 50k last year? Gusto ko sana icancel kasi lack of financial na, last may 15 2018 po un nag start ako ng life insurance, pinili ko annually kaso etong may 15 2019 wala nako ma ipay so gusto ko sana icash out, may alam ba kayo kung pano marerefund?
    May 17, 2019, 07:56 PM
  • FutureGizmo: Hi Sonny, the posting issue is now resolved. Thanks for informing us! We're currently testing a new, mobile-ready theme so let us us know kung may problema pa sa Forum. :)
    Apr 04, 2019, 10:40 AM
  • sonny.wapak: Nakaka receive din ba kayo nito pag gawa ng new post? "Please try again. If you come back to this error screen, report the error to an administrator."
    Apr 03, 2019, 10:56 PM
  • leonine_zafiro: what product nun?
    Apr 01, 2019, 10:25 PM
  • dhondiex27: hi
    Mar 30, 2019, 10:55 PM
  • lusart: jayrob i agree 200%. hulog ng langit organico. legit na legit
    Mar 29, 2019, 09:08 AM
  • palemelch: Hi
    Mar 28, 2019, 04:08 PM
  • O.C.W._AK: Magandang Araw sa Lahat! Blessings! (",)
    Mar 28, 2019, 08:42 AM
  • thor15: hello everyone, newbie here
    Mar 25, 2019, 01:47 AM
  • captjaylo: present newbie here
    Mar 22, 2019, 10:06 AM
  • balboagilbert26: hello Guys .. Newbie here
    Mar 21, 2019, 10:55 PM
  • businesswoman2019: @jefsanity nag inquire na po ako pero di sila nagdidisclose. Yung branch po kasi na target ko, currently building pa.
    Mar 21, 2019, 04:27 PM
  • jefsanity: @businesswoman2019, much better inquire ka na lang sa admin nila.
    Mar 21, 2019, 01:51 PM
  • businesswoman2019: Hello! Any idea how much ang stall sa waltermart. 2m x 2m
    Mar 21, 2019, 08:28 AM
  • John Neil: Looking for an accredited iron foundry
    Mar 17, 2019, 03:19 PM
  • jayrob: Mark_Lee ung organico legit po yan..  Member din AQ..
    Mar 17, 2019, 12:57 AM
  • perlymelad: Hello po! Need advice, why my new MLM leaders failing?
    Mar 14, 2019, 08:51 PM
  • perlymelad: Present
    Mar 12, 2019, 07:53 PM
  • kennethmauricio: Hi saan po dito pwede mag post ng for sale properties?
    Mar 11, 2019, 07:58 PM
  • jefsanity: @mark_lee isipin mo anu passion mo at skills mo...
    Mar 11, 2019, 06:52 PM
  • sniperaj09: BAGO LANG
    Mar 10, 2019, 11:16 AM
  • mark_Lee: magandang investnent ngayon sa 30k suggest naman keo mga boss
    Mar 10, 2019, 03:07 AM
  • perlymelad: E-BOOK PO SIR @JEFSANITY
    Mar 09, 2019, 05:40 PM
  • perlymelad: @jefsanity Good Morning Po
    Mar 09, 2019, 05:39 PM
  • perlymelad: Good Day everyone
    Mar 04, 2019, 06:24 PM
  • jefsanity: anu ang small business na yan?
    Feb 28, 2019, 07:40 PM
  • perlymelad: Good Day Everyone
    Feb 28, 2019, 03:31 PM
  • perlymelad: Hello everyone, CAN ANYONE HELP ME SUGGEST ANY SIDE TOPIC  / PROBLEM OF  STARTING SMALL BUSINESS?
    Feb 28, 2019, 06:58 AM
  • perlymelad: Present, 1st time po
    Feb 25, 2019, 06:17 PM
  • jd2281: newbie po
    Feb 25, 2019, 12:26 PM
  • ejllantino: present... 1st time
    Feb 24, 2019, 07:14 PM
  • rheiel: present. first time
    Feb 24, 2019, 11:04 AM
  • MELVIE: thanks po
    Feb 24, 2019, 12:50 AM
  • steph123: hello po, ask lang po, ilang months po ba ang hihintayin after mo ma process ang mga documents para maitama ang mali sa NSO?
    Feb 11, 2019, 03:13 PM
  • Deborah: newbie here.thanks
    Feb 08, 2019, 02:17 PM
  • marj0503: hello im newbie here
    Jan 31, 2019, 10:53 AM
  • yan24: any one here planning to start a tesda skill training center
    Jan 26, 2019, 12:07 PM
  • manzjon: Forex trading forum
    Jan 25, 2019, 02:16 PM
  • Lizette Ramos: Pwede po bang patulong... Maganda po ba ang gasul retailing business?
    Jan 24, 2019, 09:14 PM
  • Imnobody: Hi sino naghahanap ng casino financer dito?
    Jan 16, 2019, 09:59 PM
  • Odlanyer22: Good day!
    Jan 16, 2019, 09:55 PM
  • maryen: at kung sakaling may somobra sa food na nailuto.. dapat po bang bayaran ng client un .. or ipapa take mo na sakanila?...
    Jan 16, 2019, 03:52 PM
  • maryen: HI! GOOD DAY! newbiz lang po... question lang po regarding sa catering.. if may 50pax po ako dapat lang po ba na sakto ang serving ng food?
    Jan 16, 2019, 03:50 PM
  • mark_Lee: cno na nag organico dito scam po ba yun or legit
    Jan 09, 2019, 03:04 AM
  • kuray08: Have a Prosperous New Year to all..
    Jan 06, 2019, 09:27 PM
  • ethan: Sino po may auto supply business dito? How profitable po ba ito in terms of monthly income? Lalo na kung meron na one or two na competition.
    Jan 04, 2019, 11:34 AM
  • Niel Jhacoubs: HAPPY NEW YEAR!
    Jan 02, 2019, 04:37 PM