No. of Recommendations: 0
Rayvt: "Target is not to have any one stock be more than 3% of your portfolio. Absolute max is 5%."

I am surprised you use 3%.

I prefer a 5% individual cap and might let ift drift somewhat higher if it was fundamentally sound, but not more than 8%.

I also consider from the view of portfolio diversification. A 5% cap then requires at least 20 different positions, which is enough to diverisfy if chosen carefully.

At 8%, that would really be 12-13 positions, which is getting too small to properly diverify.

At 20%, that might be no more than 5 positions, which is a cvery concentrated portfolio and impossible to properly diversify.

Regards, JAFO
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