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Portfolio Management – Portfolio Risk (2)
By Create Wealth Through Long-Term Investing and Short-Term Trading  •  March 12, 2011
What does Japan Quake tell you something on risk management on your portfolio? No matter how good you are with your TA or FA or both. You still must at all times protect your portfolio against Black Swan event that may happen and causing big losses to the portfolio. It is lot harder to recover from big losses in the portfolio. In Joel Greenblatt's brilliant book, "You Can Be a Stock Market Genius", he provides the following statistics by owning the following number of stocks:
  • 2 stocks eliminates 46% of non-market risk of just owning one stock
  • 4 stocks eliminates 72% of the risk
  • 8 stocks eliminates 81% of the risk
  • 16 stocks eliminates 93% of the risk
  • 32 stocks eliminates 96% of the risk
  • 500 stocks eliminates 99% of the risk
Read? Portfolio Management - Portfolio Risk My risk management rule is based on Investing Capital and not at Portfolio level so that the ......
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By Create Wealth Through Long-Term Investing and Short-Term Trading
I am 62 yrs old uncle living in HDB heartland who has achieved financial independence @ 56 and finally retired @ 60 from full-time job as employee on 1 Oct 2016. Single household income since 1995 with three children. Eldest son and daughter are now working and youngest son still in his 3nd year Uni in SUTD. I have been doing long-term investing and short-term trading in Singapore stock market only since Jan 2000 so I am that Panda or Koala in the investment world; but I am still surviving well in the wild. I am now executing my Three Taps solution model to maintain sustainable retirement income for life till 2038. Cheers!
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