I was thinking about whether it is better for us to diversify our portfolio across many different shares, maybe through indexing or is it better for us to pick individual companies that we think will outperform the markets. The conclusion that I was able to reach was that it is better for people who have more time and a bigger risk appetite to buy individual companies while others who are working or maybe even in retirement, should try and diversify our risk.

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I think this issue is like asking if we should go for higher-yielding, more risky investments or lower-yielding but safer investments. For people who have the time and the risk appetite to do so (able to afford some large losses at times), being able to concentrate your resources onto the few companies that you have identified as out performers in the long run, due ......