Thank you so much for bringing out the difference between process and outcome clearly. This same warren buffet approach is applied by Peter lynch too, where he used to invest in 1000 of stocks and those who do well , will remain in the portfolio. Its like in earlier periods, when new born deaths were more likely, people used to give birth to as many children as possible and then out of 15-20 children, may be 5-6 would survive, just like a portfolio.
On similar lines recently i curated a list of roughly 40 stocks out of Nifty 50, Nifty next 50, Midcap 150 and small cap 250 indices, so rougly 10% invest-worthy stocks, out of top 500 stocks on the basis of some well known criteria like non-psu, non-cyclical, no or very less debt, high promoter holding, high ROCE, high sales growth, profit growth etc. I would be thinking on same process-driven line, where I will be investing in these 40-45 companies and if they survive, they will become concentrated holdings of my portfolio in future and those who die natural death, they will go out of portfolio.
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