There were two things on my mind recently:
- Living with a transition from a concentrated strategy to a more diversified strategy.
- Proper position sizing versus the risk of ruin.
I written my thoughts
distilling position sizing,
conviction,
trying to be financially responsible before.
As a student of the game, it is always illuminating to hear about how money managers handle the finer details of investing.
I was reminded of two interviews
Joel Greenblatt did that explains these two disciplines separately. Joel Greenblatt wrote a series of highly popular investment books, runs Gotham Capital and teaches investing at Columbia University.
Why did Joel transition from a Concentrated Investment Strategy to a much more Diversified Strategy?
Joel and his partner used to run a very concentrated NET-NET portfolio where 8-9 holdings will make up more than 80% of his portfolio. It is not uncommon for him to wake up one day and see some...
