Author Topic: position sizing  (Read 28547 times)

rkbabang

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Re: position sizing
« Reply #70 on: February 19, 2021, 11:47:33 AM »
It's easy to have a focused portfolio. Simply research 2-3 investment ideas per day (10-20 per week), and only buy the top 1% of your ideas. As long as those ideas have a large margin of safety and no significant leverage or negative risk optionality themselves, succeeding with a ten position or less portfolio is easy!
So your average holding period is about 18 months? Is that right?
So i guess your holding period seems 'forever' as it is more than double the average period now for the average crowd.

i've started doing 'this' about 20 years ago and one of the most striking features has been the unrelentling rise in competition.
Some days i wish i'd have started in 1957 or something but then again, now is probably one of the greatest times to be alive.

I need someone to tell me what my top 1% of my ideas are, because I have no clue myself.

The present is almost always the best time to be alive. Exceptions were probably the 14 century (epidemics) in Europe ir if you were born in Germany before 1618 or 1914 (very ugly wars).

Agreed on both points.  What that chart above tells me is that if I am holding for only for 1 or 2 years I will be competing against everyone else and I am not going to try to tell myself that I am some kind of exceptional genius that can compete with the majority of the professionals and win.   My competitive advantage is that I'm willing to hold for 5, 10, 15+ years.  All I need to do is find stocks with long runways, buy them and hold.  I won't win trading against professionals, or even algorithms.  And I am never confident enough to tell myself this stock right here is one of my top 1% of ideas for this year.   I'm just not that good.


ValueArb

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Re: position sizing
« Reply #71 on: February 20, 2021, 04:10:37 PM »
It's easy to have a focused portfolio. Simply research 2-3 investment ideas per day (10-20 per week), and only buy the top 1% of your ideas. As long as those ideas have a large margin of safety and no significant leverage or negative risk optionality themselves, succeeding with a ten position or less portfolio is easy!
So your average holding period is about 18 months? Is that right?
So i guess your holding period seems 'forever' as it is more than double the average period now for the average crowd.

i've started doing 'this' about 20 years ago and one of the most striking features has been the unrelentling rise in competition.
Some days i wish i'd have started in 1957 or something but then again, now is probably one of the greatest times to be alive.

I need someone to tell me what my top 1% of my ideas are, because I have no clue myself.

The present is almost always the best time to be alive. Exceptions were probably the 14 century (epidemics) in Europe ir if you were born in Germany before 1618 or 1914 (very ugly wars).

My post was partly tongue in cheek, but if you are reviewing more than 50 investment ideas per month, I think it builds the muscle that helps determine which is best. It reduces the impulse to buy the latest hit idea and raises your bar for purchases.

Maybe not to the level that can discern best 1%, but surely best 10%.
Nothing in this world can take the place of persistence. Talent will not; nothing is more common than unsuccessful men with talent. Genius will not; unrewarded genius is almost a proverb. Education will not; the world is full of educated derelicts. Persistence and determination alone are omnipotent