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URL:  http://boards.fool.com/why-i-cant-cost-average-help-25121629.aspx

Subject:  Why I can't cost average: HELP Date:  2/2/2007  2:47 PM
Author:  oparrott Number:  6 of 31

Hello foolish friends,
I'm an HG member trying to keep a portfolio of a few good stocks that I can hold profitably for years. I want to own less than 20 different stocks because that is all I feel I have the time to follow closely and I don't think more diversification is necessary. So rather than keep jumping on new recommendations, I feel I should increase my positions in the stocks I already have unless I feel very strongly about a new pick. (I buy more stocks with every paycheck.)

But many of the HG stocks I have keep growing and THIS is my problem: I find it hard to buy more when I have to pay 27.89% or 36.57% more than last time. But it seems reasonable to buy more if I believe they will keep growing, otherwise I should sell. And I do believe they will grow but I can't convince myself to pay more than last time. Anyone have this problem? Can anyone tell me it DOES make sense to pay more for a stock than last time? I dont' want to have a portfolio with 50 stocks that I bought because they were discounted or this month's recommendation because I feel that will make my performance too average, diluting out any big winners with many (by definition) average picks. Please Help.
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