About Lesson
Diversifying the stocks you own is an important factor.
Many confuse diversification as ‘buy something from each sector’.
Diversification in our minds is about the following:
For the growth stocks you own just have 1-2 stocks for each mega-trend.
- Don’t go ‘all in’ growth stocks.
- Allocate a % of your capital to defensive and value stocks. This will protect you when the cycles change.
- If you don’t believe in the future value in a particular sector e,g, Oil and Gas, simply don’t invest in it.
- Keep a spreadsheet to understand what % you have in any sector/trend.