How many individual stocks do you hold for optimal diversity?

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  • #111419 Reply
    Steve

      If you’re truly an individual stock picker, then you need 20-30 stocks across different segments to be diversified.

      I probably have about 50, but watch about 100 individual stocks, and typically watch a stock for a year before I buy it.

      I won’t BS you and say I haven’t had my clock cleaned by a GE or LU over the years, but that’s the reason for diversification.

      There are a lot of people here that risked $5k on an AAPL or TSLA or other stock and reaped $1M+ returns.

      If you do like everyone does, you get the same result as everyone.

      If you want to be unique, you need to think outside the ETF.

      #111420 Reply
      Sean

        Most people aiming for fire are doing the tried and true method of low cost index funds.

        I think this group wont be the place to get the best answers to your individual stock questions, but hopefully someone can help.

        #111421 Reply
        Bill

          I have no stocks in my retirement accounts.
          5 individual stocks out of 15 holdings in my brokerage account.

          #111422 Reply
          Angela

            The experts say you shouldn’t have more than 5% of your portfolio in any individual stock. 2-3 good companies in each sector for the diversification.

            However, holding that many stocks takes up a lot of time studying & monitoring performance. 20-30 only if you know what you’re doing.

            Almost everyone is better off to choose a small handful of ETF’S that align with your goals & time horizon, then add to them on a regular basis regardless of what the economy or the stock market is doing.

            Stick to the plan, keep adding to your portfolio with every paycheck.

            Ignore the news & politics. Ignore the dips & crashes. Ignore the bubbles & all-time highs.

            #111423 Reply
            Richard

              10% of my portfolio value is in single stocks. 5 currently. The rest of my portfolio is ETFs.

              #111424 Reply
              Doug

                I used to have about 70 stocks from an investing newsletter I subscribed to. I did that for about 15 years and did quite well.

                However, it became too much of a pain to keep up to date on and things were far too complex for my wife or kids to take over if something happened to me.

                I’ve been simplifying over the last year or so.

                I’ve sold most individual stocks except some that have significant gains in my taxable account.

                Simplification isn’t enough reason to sell a fundamentally good stock/company and incur capital gains.

                Nearly everything will be in ETFs in the end.

                #111425 Reply
                Dave

                  I like putting a tiny percentage of my nest egg in individual stocks. Just enough to make it interesting to keep tabs on how they’re doing.

                  About 8 or 9 years ago I did that with Microsoft, Google, Facebook, and Netflix. It worked out well.

                  A few of my other bets were a disaster (I’m looking at you, Rivian and Baidu), but the amounts I risked were tiny, so they didn’t really impact me much, and were vastly outweighed by my gains elsewhere.

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