As you are from business field, you know that behind ever stock there is a company, and a company does some business. So if you want to allocate a portion to a sector in your PF, know about the sector, its future growth prospects, because as there is sector rotation in the market, even though the selection of stocks is good, the stocks may not move much, as the sector is out of favor.
Then focus on individual companies. Going with one company is preferable only when there is a compelling reason behind it, say someone choosing Infosys over TCS because he works in Infosys, or valuation is a reason, there could be so many reasons. Going with a basket approach will limit any future fall to some extent, but also limits the upside too, just like an index. Again, if it is a performing sector, then the basket will be profitable.
If your technical knowledge is enough, you can wait or start building positions, depending upon the charts.
Long term means years, at least a few years. So we start at some point and slowly build our perspective, our process, along with it our PF. There could be 20 different changes owning to 20 different reasons before one reaches a long term PF.
Also, this is my perspective, there are investors with different perspectives, from different schools of thought, having different strategies, and we all develop and follow a process that suits us, many ways to skin the cat.
There are many types of investors here in the forum, know their styles, the time spent in the forum will be rewarding.
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