How many stocks do you hold in you portfolio?

[dingoNZ]

This came up in another thread recently and there seems to be a lot of mixed opinions on how many different stocks they feel comfortable holding. Just curious as to what the general consensus is. Interested to see what peoples opinions are.

So how many different companies do you hold in you portfolio? Please vote

[MAC]

Depends on too many variables to ascertain a generic outcome.

Time horizons, type of investor, growth, value, income, trader, also whether one just has stocks or if diversified elsewhere, property, cash, classic cars, etc. Life circumstance, dependents, how far from retirement, young folk can take on more risk.

Each to their own, although if you are solely in stocks then you need to assess your overall risk profile.

Calculate your portfolio beta, set diversification limits based on sector risk and the stage a company is at, start-up, growth, maturing or dividend paying, also on the quality, plausibility and reliability of numerical guidance and management etc. Consider holding options if or when you can get them, also a good way to manage risk.

The number of stocks you hold should fall out of the above.

[barleeni]

10 - all small holdings until I get a better grasp of the game.

[Okebw]

Usually 10 or so long term holds and 4 or 5 speculative Aussie stocks. With a lot less weighting of course

[kizame]

Usually 1-2 companies at the most asI'm not usually in for too long.

[tim23]

19 stocks plus a few specs like BRL, SNK, VET & PEN on the ASX

[OldRider]

Thought this was interesting

From Miles Udland at Business Insider:

[James O’Shaughnessy of O’Shaughnessy Asset Management] relays one anecdote from an employee who recently joined his firm....

O’Shaughnessy: “Fidelity had done a study as to which accounts had done the best at Fidelity....They were the accounts [of] people who forgot they had an account at Fidelity.”

There are numerous studies that explain why this happens. And they almost always come down to the fact that our minds work against us. Due to our behavioural biases, we often find ourselves buying high and selling low.

[Crystal Ball]

Hi dingo nz, I hold a lowly 2 however they are both speculative so probably quite risky. High gain if they pay off.....

[BlackPeter]

Actually, there is a lot of maths behind determining the optimal number of assets to hold in a portfolio (start with http://en.wikipedia.org/wiki/Modern_portfolio_theory and than follow the appropriate links). To cut it short - the optimum (low beta, but not too high diversification cost is somewhere between 13 and 20 statistically independent assets. The problem with this information is however, that it is hardly possible to find that many statistically independent assets (related industries, related markets).

Discl: 40% of my assets are spread over some 25 stocks, the rest is spread across real estate, life insurance schemas and funds like Kiwisaver. I am probably overdoing the diversification somewhat, but so far can live with the diversification cost (and sleep better during the nights).

[fungus pudding]

I'm underdoing the diversification bit. I hold a fair number of shares in six property trusts. A minimum of 100,000 and max of 300,000 shares in each. My only other assets are commercial buildings. I don't know the first thing about the share-market, or any listed businesses and have spent my life on buying and never selling. Just stacking up income with every move. Started buying LPTs a few years ago as I couldn't be bothered buying another building, and getting past it anyway.
They give a good income, particularly with the PIE tax status - most equate to between 8 and 9% for a 33% tax payer. Also a bit of growth - don't know how they compare with the market in general, and don't care either. I'm happy - but then I'm easily pleased.