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URL:  http://boards.fool.com/2828-suggested-in-an-earlier-post-that-i-raise-a-30511276.aspx

Subject:  Re: On second thought, 2828 - Small Cap Issue Date:  1/28/2013  3:54 PM
Author:  ascenzm Number:  668765 of 725981

2828 suggested in an earlier post that I raise a retirement topic, if that's what I want to discuss. Maybe he/she's right, so here goes ...

Besides Options, I'm evaluating MF Hidden Gems. I have about 35% of my portfolio in small caps and all of this, with the exception of a single small position, is split between IWN and IWO. (These are small cap value and growth stock ETF's, respectively.)

I used ETF's for my US small cap asset allocation both to diversify away as much risk as I could, and to save time studying stocks. Though IWO and IWN have done very well over the last decade or so, tracking their indeces admirably, I think I'm ready to do a little more work, take a little more rick, and shoot for slightly better returns.

The question is this: how many individual positions should one take within a small cap allocation? HG holds a whole ton of tiny positions and many on the boards seem to lean toward "big" numbers (say 20-30 positions) as well. I think the risk can be managed with 10 or fewer within that asset class.

Thoughts? Trey


I'm a fan of index funds as I don't want to spend time analyzing individual stocks when I could using the time to more enjoyable pursuits. If you want to dabble in individual stocks why don't you set aside a small amount of your investments (your mad money) and pick some individual stocks. If you lose out on these picks you still have the bulk of your investments.

Mike
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