/biz/ - Business & Finance

You should probably listen to Larry Swedroe.
http://seekingalpha.com/article/1945621-why-bother-diversifying-just-buy-berkshire-hathaway

>>112820
I wouldn't buy Berkshire Hathaway because you can take Buffett and Lynch's lessons and apply them to small-to-mid cap stocks (or even undervalued large cap stocks) and get better returns. Also because the challenge of doing it yourself is fun. But, diversification is not only a sham, but a bad thing. Just hold 3-10, maybe 15 tops really good stocks that you've concluded liking every aspect of and are staying on top of.

>>112860
You didn't read the article. It's actually stating that you shouldn't have undiversified your investments by only investing in Buffett.

>>112904
No, I know, I understood that. I was adding to it when I said diversification was a sham. And I was saying I'd like the challenge and fun of trying to beat Berkshire via my own stock selection with Buffett and Lynch rules rather than invest in Berkshire.

>>112807
gooby pls

>>112807
>Buffett is crippled by how much money he has to invest
Problems other people would love to have.

>>113177
True, an average person. But someone who doesn't care much for personal use of money (Buffett) having to rack up good return numbers and also being limited to huge stocks only, it sucks.

>>112860
>diversification is not only a sham, but a bad thing

>>113282
>Have group of 100 stocks.
>Pick the best 15 out of the 100 that match the most good criteria.
>Profit.

>Have group of 100 stocks.
>Hold onto them all.
>The gains from the 15 stocks in those 100 are halved or worse by the other 85 stocks that did either horribly, mediocre, or not as good as the best 15.

>>113282

This
>>113343

>>113282

It's better to concentrate heavily on a few stocks than heavily diversify

buffett abuses tax minimization he'll be fine forever

>>113653
>buffett abuses tax minimization
Source? Also, who wouldn't? Only a retard.

>>113343
not only that, you'll pay crazy brokerage fees if you invest in 100 different stocks

>>112860
>you can take Buffett and Lynch's lessons and apply them to small-to-mid cap stocks
Lynch says "buy what you know". I have made plenty of money from 1992 to now investing in IT stocks I knew something about. I do it less now. My last big exit was when Cisco bought WEBX, that was years ago.

I think Google is not over-valued and is a good buy right now.

>>113661

what if you believe in the good of taxes to support your country? fuck that tax minimization and abuse shit I'd feel so ashamed of myself if I offshored money to the cayman islands and had accountants look for all the loop holes.

>>113675

Not if you just buy SPY or some other broad index fund.......durr

>>113734

google's stock is only going up and up. you see their Q4 profits? they literally already own the world

>>113741

>implying smart people like Buffett want to support the clusterfuck black-hole of waste and handouts that is the US government

>diversifing

>>113741
>what if you believe in the good of taxes to support your country?
You believe the government can spend your money better than you can? Cool, enjoy paying for their $500 toilet seats and foreign wars.

>>113741
>Paying taxes
>To support your country

>>113767
>Russell-Wilson Investments
Is that your company or something?
>Tfw highly talented and want to be a part of an investment company or hedge fund but have no college or formal credentials so maybe a 4channer would welcome me with open arms gooby pls.

Meanwhile, in the real world.

>>113741
>feeling ashamed that you contributed to the economy and your money wasn't stolen from you to support endless aggressive wars

idiot

>>113783
Naa, it's just a play on words based off the company Russell Investments

but the seahawks QB Russell Wilson is my favorite, so I put the wilson in there

I run my own portfolio, undiversified of course.

You could always do the same, and use your autism to make you money

I just need to get a job now once I graduate with accounting degree, so I could find my portfolio with more money to invest with

>>113795
http://li16-138.members.linode.com/defunct/about-berkshire-hathaway/images/BRKvsSPcumulative.png

Plus the fact that Warren essentially has to invest in S&P 500 size companies more and more every year because he has too much money to invest in smaller companies. Maybe in the later years it's getting worse.

>>113829
>You could always do the same
>Tfw have no money.
Oh well. Good luck with yours. Do you mind disclosing your portfolio picks? Did you make sure to buy them undervalued?

>>113873
Yes, most of the time I buy when the company gets undervalued (or everyone panicks, and the company drops like 8-10% in one day for no good reason)

I only own one stock at a time, cause I don't have that much money either

But I bought shares of (LCC) US Airways at 15.99 (they were like at 20, and dropped to 15.99 in one day), and sold it for 20 bucks a month or so later (although they later merged with another airline, and are worth 30 now :(

And then I have Tesla now, got at 177, now 206

>>113913
The joke in the big investment people community (Lynch, Buffett, etc.) is that the quickest way to become a millionaire is to invest a billion in airline stocks.

Also:
>Tfw discovered TSLA at $17 but brushed it off.
>Tfw then wanted to absolutely buy TSLA at $50.

>>113950
airline stocks are simply amazing

>tfw was familar with tesla around the 30-80 dollar mark, but when it got to 80, I thought it was incrediably over priced

>tfw then got over my stupidity to buy it finally at 177

why was I such an idiot before

>>113972
>>tfw then got over my stupidity to buy it finally at 177
>why was I such an idiot before

>Idiot before.
>Idiot
>Before

m8

>>113972
>tfw then got over my stupidity to buy it finally at 177
That's one big bubble, man.

>>113991
>tfw I've made 16% off tesla
sure dude, tesla is soo bad.

>>113999
It bubbled before close to when I bought it, and dropped to 132.

But since then, it came back, stronger than ever, and people realized its really worth the price and more.

Tesla is past the bubbling stage
(hopefully)

>>114009
Tesla is going to fall off the map when the other car companies beat it.

>>114066
>other car companies beating tesla
>expecting companies like BMW and Porsche to outsell Tesla in electric high end cars in the future

>>114090
The free market will fix it.

>>114009
Man, as much as I want TSLA, I wouldn't buy it for more than $100 a share right now. Especially since we're near another market crash in the next year, even if it's worth $200+ a share it will crash because of irrationality.

>>114116
I think Tesla will hit 300 within a year.

They are growing rapidly right now, it's very possible

>>114135
You may be right. Just sad I missed it at $17 and $50. Good luck, Anon.

>>114190
I'm sad too, It was one damn bitter and expensive pill to swallow buying at 177, but fuck it, It's proving to me like it was a good investment even still.

thanks bro, maybe if it tanks, you will be able to grab it at 100 lol

>>113343
When people say "diversify" I don't think they generally mean go fucknuts and buy hundreds of stocks. That's just fucking stupid.

>>114430
Some of them do.

>>114430
You'd be surprised.

>>112807

>implying i didnt allocate 65% of my portfolio to B shares pre-split

>Diversification dilutes risk
>Risk accrued is what allows potential profits
>Diversification dilutes profit with no real benefit added

>>114629
This

>>114629
dude you're still buying into the diversification theory nonsense
diversification eliminates nonsystematic risk from your portfolio if you follow this model potential for returns is based entirely on relative amounts of systematic risk borne by each company you're investing in
ofc that is emh circlejerk bullshit that nobody cares about because it's retarded

>>115355
No, they're making the argument against OVER diversification, not normal diversification.

If 5 stocks is better then 1, then 15 stocks are surely better!

But, you get reduced returns(plus increased overhead of research) after a point.

Can't find source, but I've come across it a couple times. Essentially after 20-50 holdings, you start becoming an index yourself

>>114190
trashman pls

You really shouldn't tell people not to diversify. Personally I see nothing wrong with diversifying either by buying a total market index or S&P500 index, OR by owning and keeping track of as many stocks as you care to keep track of (ie, if you're told to only hold 10 stocks but see 15 excellent buys and have the capital for it, I see nothing wrong with making all 15 buys and being slightly more assured that your money is better protected from risk).

You diversify if you don't want to lose money. You focus if you want big gains (but then you risk losing money).

>>114629
>Diversification dilutes profit with no real benefit added

I really wish you were a tripfag so I could filter this fucking nonsense. The benefit is a lower standard deviation of expected portfolio returns. You don't have a clue what you're talking about, go read some portfolio theory before you post this shit again. fuck.

>>113595

Unless you are wrong. And nobody is right 100% of the time.

>>117105
>portfolio theory
>caring what some egghead academic has to say

>>117105
>>117817

Here you fucktards go:
http://www.investopedia.com/articles/01/051601.asp
http://www.businessweek.com/stories/1995-07-16/the-diminishing-returns-of-diversifying
http://seekingalpha.com/instablog/3615471-lodestonecapital/1066151-limited-diversification-benefits

ITT: Greedy, sociopathic nihilists who if they had $10 million would trade it all on one ultra-risky stock, lose every penny and shug and go "Eh, was worth it."