All posts by Bryan Kelly
Research confirms investment counts matter
Investing academics and holding counts in multiple studies conclude 16 stocks are the ideal number, with 5% to 7% of a portfolio held in each position. The range is surprisingly narrow. Most suggest between 15 and 20 stocks as the best number. You and your top research assistant, Google, can find endless numbers of studies.
Read MoreMoney making stock issues
Considering how many stocks to hold ranges between 5 to 30 stocks with an exception. There are 5 Factors to consider: Number of holdings, Size of positions, Diversification, Risk and Psychology. This post is part 1 of the 6 part White Top View series, Introductory Portfolio Management – Counts and Sizes.
Read MoreCheck market direction trends
Part 4 of 4: White Top View, Market Direction series. Yesterday we began our discussion of five key stock market direction pointers. Today we conclude that discussion. Digging deeper into economic data can refine the results but there is little practical reason to do so. The basic approach works well. Trending up produces a rising stock market; tending down produces a falling stock market. When the trend is up, confidently take stock positions. Go long by buying shares. Purchase stocks that benefit most from economic growth. If the trend is down, get out of the market by selling stock positions and going to cash. Alternately in a down market, sell short to profit from falling stock prices.
Read More5 Star market compass
Part 3 of 4: White Top View, Market Direction series. Get a fast read on the most likely stock market direction. Some easy observations and a few simple questions can give you a reliable and useful indication of stock market direction. Among your contacts, neighbors, friends and family, observe and ask questions on the five following points: Careers advancing or are jobs being lost? People concerned or confident about employment? New cars being bought or old cars repaired? Houses being purchased and renovations made? More people upsizing or downsizing? You can spend weeks delving deeply into economic reports or listening to the droning and arguing of pundits, experts and politicians. Or use this simple alternative approach which works very well.
Read MorePatient Stock Market Research: Find The Best Investment Opportunities
Patient Stock Market Research: Find The Best Investment Opportunities guides investors to long-term success. Pam discovers the guidance she needs to put her patient cash savings to work effectively. Investing success is often built on two key qualities: patience and thorough research. These elements form the bedrock of a successful investment strategy, empowering investors to consistently outperform the market. Patient investors are willing to wait, accumulating cash as they carefully analyze market trends, financial reports, and emerging opportunities. When the right moment arrives, they act swiftly, leveraging their research to make informed decisions. This lesson focuses on how mastering patience and research empowers investors to uncover the best investments, avoid costly errors, and achieve long-term wealth. By skillfully balancing a cautious approach with timely action, investors can confidently navigate market uncertainty and capitalize on opportunities as they arise. Investors who patiently hold cash often distinguish themselves by consistently beating market indexes, poised to invest at the optimal time. However, when Pam was ready to invest her carefully saved cash, she realized she needed more guidance. She wanted to quickly find the best investments and take advantage of promising opportunities, but she also feared that buying without thorough research could undermine her portfolio. Pam grows to understand how successful investors manage uncertainty, sift through misinformation, resist the temptation to follow the crowd, and combine patience with research to make sound, strategic investment decisions.
Read MoreLook forward with data
Part 2 of 4: White Top View, Market Direction series. Investors use data to look forward, typically about 6 months. While not strictly a prediction, it expresses near term expectations of economic direction. That so called predictive function can strongly suggest the most probable future. That can tip us off to both opportunity or danger in the markets. We can use it as either or both a big money-maker or capital saver! The desire to know the future direction motivates much research. Seeking, compiling, identifying and reporting indicators keeps many people busy.
Read MoreFind money making stocks
Win by picking winners!
Look among the stock market leaders for the winners. That is how to find stocks that consistently make you money. Stocks that lead the charge upward in bull markets consistently produce profits for shareholders. Go there and pick among the leaders to build a portfolio of winners.
3 Risk or opportunity signals
Part 1 of 4 in the White Top View, Market Direction series. The market has a predictive function, the trend is your friend, Up, go long, down go short or get out. Use those three stock market guidelines rather than endless expert reports. The market looks about 6 months ahead anticipating where the economy will be going during the next two quarters. Identify that trend, up or down and take positions that benefit from that direction. When the trend is up, play long. When the trend is down, play short or get out.
Read MoreInvestor homework grows profits
Investor homework piles up facts and profits. Series Part 7 of 7. Patience and homework, your two biggest investing tools, piles up facts and profits. Patience lets you wait for opportunity and enjoy the long ride to prosperity and financial security.
Read MoreStock market dip opportunities
How to play a stock price dip covers dips as excellent buying opportunities. Part 6 of the 7 Part Playing Market Odds series. Think of a stock price dip as either good or bad depending on the context. Buy the good, sell the bad. A good dip presents a gift of profit but a bad one vaporizes capital. So, yes, do buy good dips. It can be a very profitable strategy. We just need to buy the right dips and sell or avoid the wrong ones. To sort that out requires us to establish some guidelines. Price dip triggers: News – the facts change, Rumor – true or false, Opinion – analysts or large investor, Fatigue – shareholders tire or give up, Trading – indifferent, sloppy or emotional.
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