this is how nearly all billionaires have made their wealth – they are invested in a single stock – their own company [the rest are inheritance]
If you are externally investing in a single stock, you lose out on the ‘control’ factor and are unaware of what is going on inside the company.
By investing in a single stock, you are shunning diversification. So let’s look at diversification. Diversification is an excellent tool which is geared towards wealth preservation and gives up on some potential upside. So you ought to avoid diversification if you don’t need it, which is one of the two cases: (A) you don’t have much downside if you lose all OR (B) a diversified portfolio will most certainly not lead you to financial freedom.
If it’s case (A) – I suggest you go for it! After all, there’s nothing to lose!
If it’s case (B) – you need to be far more diligent here. Why a particular stock and not some other one? Why would it lead you to financial freedom? What are the triggers? And so on … many many questions. But by and large, look at (1) how founders of companies think (2) how intelligent risk takers think (Annie Duke’s book for example, etc) and (3) how bridge players, sportsmen and coaches or other strategists think.
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