Scaling Up Portfolio

[robertbanking]

Hello you wonderful and very intelligent people. I do hope you are having a successful week and your investment portfolio is flourishing.

I have done okay with my portfolios, sometimes stocks have done around 10% a year, a few lost maybe 15%. Then there is one or two that have gained around 25% - 30%. I kindly wanted to ask please when structuring my portfolio, if a stock, after a full amount of research, is increasing cash flows, has low debt and meets a good criteria, could i consider putting 40% of my portfolio into that stock please? I know there is more risk, but i just dont seem to be getting very far with my portfolio. I feel its too evenly balanced, i usually put about 20% evenly into stocks in my portfolio. I know Warren Buffett when he initially bought See Candies this was for £25 million, which was out of character for him, but helped him reach where he is today. If anyone kindly had any advice on this i would be forever grateful and thankful, it would mean the world to me.

Wishing you a wonderful day and hope you continue to achieve all your goals and dreams. Sending you lots of good wishes. Take care.

 

[Telamelo]

Hello you wonderful and very intelligent people. I do hope you are having a successful week and your investment portfolio is flourishing.

I have done okay with my portfolios, sometimes stocks have done around 10% a year, a few lost maybe 15%. Then there is one or two that have gained around 25% - 30%. I kindly wanted to ask please when structuring my portfolio, if a stock, after a full amount of research, is increasing cash flows, has low debt and meets a good criteria, could i consider putting 40% of my portfolio into that stock please? I know there is more risk, but i just dont seem to be getting very far with my portfolio. I feel its too evenly balanced, i usually put about 20% evenly into stocks in my portfolio. I know Warren Buffett when he initially bought See Candies this was for £25 million, which was out of character for him, but helped him reach where he is today. If anyone kindly had any advice on this i would be forever grateful and thankful, it would mean the world to me.

Wishing you a wonderful day and hope you continue to achieve all your goals and dreams. Sending you lots of good wishes. Take care.

Hello & welcome.

With considering to increase any given holding to 40% or higher in trying to improve one's portfolio performance overall... it comes down to your own personal risk appetite/tolerance & trading plan/strategy. What do you feel comfortable with, type of trader/investor you are & assessing/implementing a trading plan strategy that suits you/your trading personality as such. Knowing yourself as a trader/investor just as important as researching any given stock.

Once I determine a stock that peeks my interest/conviction, then I use multiple bids to look at scaling into a sizeable position over a period of time (try to buy low of course) - I rarely buy up big in the one order - I spread it across 3-5 multiple bids over time trying not to chase price higher but hoping price comes to me instead. Sometimes however I regret this as have missed out altogether reaching my 40% weighting because price has taken off/run up sooner than I anticipated & pullback never eventuated leaving my buy order way down the list as a result (can be a tad frustrating at times). Other's tend to add to their positions as price moves higher so that is something to consider as well. I tend to try patiently accumulate at a predetermined price as want lowest possible average entry price.

Once you build up a sizeable position then managing risk/managing trade becomes ultra important. Do you have a take profit target in mind ? an exit plan as such.. knowing when to sell is even more important than knowing when to buy imo

I tend to try let profits run but do sell a few parcels on the way up so as to de-risk my original position. I usually allow 30-40% of original position to run indefinitely till such time my trailing stop loss gets hit (around 12%-25% below actual stock price).

The key is to have a plan & be disciplined enough to follow it (not allow human emotions & impulsiveness to take over). Remember to cut any losses early. Capital preservation is the name of the game.

Most importantly is to also be able to still sleep well at night regardless of how your portfolio is performing. Anxiety & stress are negatives/detrimental to one's trading success & health so try to be in a positive mind set as best as possible when trading. Best decisions are made when calm & happy.

I hope you may find some of these points useful as "food for thought" at least towards improving your trading success. I'm definitely no expert can tell you now - it's an ongoing learning experience over the course of one's life.

Very best wishes & good luck!

 

[divs4ever]

Hello you wonderful and very intelligent people. I do hope you are having a successful week and your investment portfolio is flourishing.

I have done okay with my portfolios, sometimes stocks have done around 10% a year, a few lost maybe 15%. Then there is one or two that have gained around 25% - 30%. I kindly wanted to ask please when structuring my portfolio, if a stock, after a full amount of research, is increasing cash flows, has low debt and meets a good criteria, could i consider putting 40% of my portfolio into that stock please? I know there is more risk, but i just dont seem to be getting very far with my portfolio. I feel its too evenly balanced, i usually put about 20% evenly into stocks in my portfolio. I know Warren Buffett when he initially bought See Candies this was for £25 million, which was out of character for him, but helped him reach where he is today. If anyone kindly had any advice on this i would be forever grateful and thankful, it would mean the world to me.

Wishing you a wonderful day and hope you continue to achieve all your goals and dreams. Sending you lots of good wishes. Take care.

@Telamelo covers much of my thoughts very nicely , where i differ is i am very unlikely to buy up to a 40% weighting of a stock , normally more than 20% makes me feel uncomfortable

now the one exception was an adventure in BSL several years ago when they did that cap. raise @ 40 cents ( and consolidated 6 shares into 1 giving a 'new share ' value of $2.40 ) i already held a tidy parcel of BSL after buying it in the turmoil before the cap. raise buying as low as 27 cents ( $1.62 a 'new share' ) now i intended to buy in the SPP but the paperwork got lost , so after a long call to BSL a staff member organised that i could buy an institutional-sized placement through a full-sized broker ( seems at the time i could barely squeak into that category ) and eventually BSL worked up to about 20% of the portfolio via capital gains ( i have since sold out of both holdings of BSL little realizing the share price would more than double again from my selling price )

for me , ( currently) i try to keep a holding below 20% of the total portfolio , by taking timely profits

cheers

 

[qldfrog]

Hello & welcome.

With considering to increase any given holding to 40% or higher in trying to improve one's portfolio performance overall... it comes down to your own personal risk appetite/tolerance & trading plan/strategy. What do you feel comfortable with, type of trader/investor you are & assessing/implementing a trading plan strategy that suits you/your trading personality as such. Knowing yourself as a trader/investor just as important as researching any given stock.

Once I determine a stock that peeks my interest/conviction, then I use multiple bids to look at scaling into a sizeable position over a period of time (try to buy low of course) - I rarely buy up big in the one order - I spread it across 3-5 multiple bids over time trying not to chase price higher but hoping price comes to me instead. Sometimes however I regret this as have missed out altogether reaching my 40% weighting because price has taken off/run up sooner than I anticipated & pullback never eventuated leaving my buy order way down the list as a result (can be a tad frustrating at times). Other's tend to add to their positions as price moves higher so that is something to consider as well. I tend to try patiently accumulate at a predetermined price as want lowest possible average entry price.

Once you build up a sizeable position then managing risk/managing trade becomes ultra important. Do you have a take profit target in mind ? an exit plan as such.. knowing when to sell is even more important than knowing when to buy imo

I tend to try let profits run but do sell a few parcels on the way up so as to de-risk my original position. I usually allow 30-40% of original position to run indefinitely till such time my trailing stop loss gets hit (around 12%-25% below actual stock price).

The key is to have a plan & be disciplined enough to follow it (not allow human emotions & impulsiveness to take over). Remember to cut any losses early. Capital preservation is the name of the game.

Most importantly is to also be able to still sleep well at night regardless of how your portfolio is performing. Anxiety & stress are negatives/detrimental to one's trading success & health so try to be in a positive mind set as best as possible when trading. Best decisions are made when calm & happy.

I hope you may find some of these points useful as "food for thought" at least towards improving your trading success. I'm definitely no expert can tell you now - it's an ongoing learning experience over the course of one's life.

Very best wishes & good luck!

Good answer above but putting 40% in one stock is a bloody risky gamble,can be affected by earthquake, war or bombing, a plane accident wiping one board..unless that stock is already a mix.. ETF, fund, etc..I would tread very carefully.
Can you not find 5 companies in the world with similar characteristics and sector localisation differencex to lower the gamble?
We tend to hear of the successful gambles, far less of the 1000's of failures..for one Warren , how many trains of losers...

 

[divs4ever]

Good answer above but putting 40% in one stock is a bloody risky gamble,can be affected by earthquake, war or bombing, a plane accident wiping one board..unless that stock is already a mix.. ETF, fund, etc..I would tread very carefully.
Can you not find 5 companies in the world with similar characteristics and sector localisation differencex to lower the gamble?
We tend to hear of the successful gambles, far less of the 1000's of failures..for one Warren , how many trains of losers...

WOW dominated the portfolio i inherited , by sheer survivor bias ( there was only four stocks inherited WOW . APE , QAN and CSR ) ( QAN since sold out , WOW massively sold down [ more than 90% ] after disappointing turn after disappointing turn after disappointing turn ( but taking profits on the way )

 

[qldfrog]

WOW dominated the portfolio i inherited , by sheer survivor bias ( there was only four stocks inherited WOW . APE , QAN and CSR ) ( QAN since sold out , WOW massively sold down [ more than 90% ] after disappointing turn after disappointing turn after disappointing turn ( but taking profits on the way )

Note my answer was regarding the original question..not your position Mr @div4ever ??(edited for clarity)

 

[DrBourse]

Maaaate - Didn't ya know that you should only ever have Questions, Never a query, ....OK.....

 

[divs4ever]

Note my answer was regarding the original query..not your position Mr @div4ever ??

yes i did and was not intended to disagree with your opinion

cheers

 

[qldfrog]

Maaaate - Didn't ya know that you should only ever have Questions, Never a query, ....OK.....

Fixed?

 

[DrBourse]

Fixed?

You or the Query ??????

I need a STRONG Cawffee