I normally start out with a bigger portfolio of about 10-15 stocks which I find promising. As I research businesses more , I keep selling companies which ,I don’t understand or whose business I don’t like or who are not performing business wise . I keep adding to my best bets and In the end I end up with 2-5 companies . So as per company performance improves or my assessment of the company improves I add to my position.
1.I am not much worried about monthly fluctuations in my portfolio . As long as the underlying businesses are healthy I am not much worried. However it still stings if portfolio value drops substantially but I think that is part and parcel of investing and you get used to it.
However If companies business deteriorates I try to exit.
2. I don’t look at price trends and I don’t think I can predict where I can take maximum profit. I have sold stocks at 70% below high value. I try to look at fundamental trends only. I have no idea about technicals.
3.If the stock is not moving but underlying business is improving I’ll add to my position. There is one caveat ,the company should have a reasonable long runway of growth(5 years minimum ) and the underlying fundamental parameters or the industry prospects should be improving.
Regards
Sandeep
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