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URL: https://boards.fool.com/rayvt-quottarget-is-not-to-have-any-one-stock-31176192.aspx
Subject: Re: do you limit your holdings to a % of portfol	Date: 3/21/2014 11:27 AM
Author: JAFO31	Number: 74579 of 101533
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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