I have this book, it's massive, it heavy and it best lay on a coffee table and browse through
it will you sit there enjoy a nice cuppa of tea/coffee
some very good advices
http://www.amazon.com/Poor-Charlies-Almanack-Charles-Expanded/dp/1578645018/ref=cm_lmf_tit_1
Dont know if there is an upgrade to this forum but
the editing -> save function doesn't work any more
I tried with Firefox, Chrome and Internet Explorer and Apple Safari, iPad etc...
I gotta agree with ROE here - great book!
And here as well unfortunately...
I’ve done a little more thinking on this rebalancing issue. Please critique, because I am not sure I have got it right and its hard to see the trees for the forest inside my own thoughts.
The decision (or lack of decision) to date has been to let the profits run. I have now decided to limit the mark to market exposure to 25% of an account. If it goes above I will trim it back to just under.
MTU was one of the companies that had climbed in % and it has had a fair impact on my final decision. One morning I looked at the screen and seen a little icon in the announcement field. A little icon that meant MTU wanted me to invest a big chuck of money at short notice at a price over 4 times my average cost – It was renounceable and the price held up early allowing options but it gave me a jolt as to the difficulties around this weighting issue.
MTU was trimmed during the rights period and got another haircut yesterday as did MMS. The gut still doesn’t quit feel right selling for weighting issues rather than business performance reasons. Still not a totally settled issue for me – more a work in progress probably awaiting some lessons to be learnt the hard way.
Spent an hour or so searching this afternoon! Looks rare and out of print unfortunately. Fairly expensive. Might monitor ebay for a few weeks and see if it appears at a reasonable price.
Spent an hour or so searching this afternoon! Looks rare and out of print unfortunately. Fairly expensive. Might monitor ebay for a few weeks and see if it appears at a reasonable price.
Thanks Hesking for both the recommendations and the purchase information. I was on that site, for some reason missed the "orders" section. Hmm.
Probably. But we have also been in a very long period of cheap bonds, perhaps because equities were so much more attractive. Using the example of US Treasuries, real yields have been falling for decades after having spiked during the era of stagflation. I think it's wholly unrealistic to expect anything much above 0% in real terms over the long run for treasuries, or similar assets. If risk is positively correlated with reward then it seems to be an aberration of history that an asset approaching "risk free" was yielding 3-4%+ over the inflation rate.
Just my
Craft, from your posts to date, you come across as a business analyst not a portfolio manager, i therefore recommend you sell due to business performance issues not weighting issues. As you advised me - one master! As long as you are taking into account the big picture from a business risk perspective, everything should work out just fine.
Personally i allocate capital as % of my net worth. I do not care how many different businesses i hold, i care more about the % of my net worth that is in a business where i am a minority shareholder with no control
Craft, I know you use your dividend cash flow to support your family. How do the numbers compare if you look at those holdings in terms of portfolio income? What is the impact of the worst case scenario? I guess what I am trying to get at is that it would be more useful to look upon what effect that it would have on your lifestyle, rather than portfolio value. After all, that is why you invest (and for enjoyment, I assume) not because you hoard wealth. You could always set a trailing stop loss for the proportion that you want to have "at price risk" (rather than business risk) if the over-balancing concerns you. Besides what would you do with the sale proceeds? Are there better, lower risk assets out there?
Craft, from your posts to date, you come across as a business analyst not a portfolio manager, i therefore recommend you sell due to business performance issues not weighting issues. As you advised me - one master! As long as you are taking into account the big picture from a business risk perspective, everything should work out just fine.
Personally i allocate capital as % of my net worth. I do not care how many different businesses i hold, i care more about the % of my net worth that is in a business where i am a minority shareholder with no control.
I agree with this. I wouldn't have the confidence to hold a single position of 25% of my portfolio. To be honest, it's a risk I need not take.
What exposure per company do you set at the time you buy in and what size would you let something grow to before thinking about reweighting?
I’ve done a little more thinking on this rebalancing issue. Please critique, because I am not sure I have got it right and its hard to see the trees for the forest inside my own thoughts.
This is the exact risk I'm grappling with. I'm not trying to maximise anything through weighting the portfolio. My one master is business perspective - but I need to weigh my lack of information and control.
Another perspective on the equity risk premium.
View attachment 47379
Current position is represented by the yellow cross.
What gets my attention is that we are in uncharted waters since the floating of the dollar, prior to that the data presents problems for drawing comparisons. It might just be my misplaced sense of adventure but I love uncharted waters.
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