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Subject:  Re: Bond allocations in small retail portfolios Date:  4/28/2011  6:49 PM
Author:  jackcrow Number:  32776 of 36633


I'm sure there are many such suggestions floating around. I am also sure we could probably drive ourselves nuts trying to make sure we are spread across enough time, bond class and ratings. What I am not convinced of is that any particular asset allocation would be dramatically superior to several others.

Approach it like you do the equity side. How much diversification do you need that is likely to manage the risks that diversification mitigates? How many positions work for you? How many positions do you want to manage? Is the goal capital gains or cash flow?

On the equity side we have folks that run very focused portfolios with great success. On the equity side there are folks running successful portfolios with way above the "recommended" number of stocks. The switch to bonds is not a perfect translation but the general concepts still hold.

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