No. of Recommendations: 4
I am just reading this off my broker's statement. My 5-year return as of Aug 31 was 11.58% over my benchmark of S&P 500 index. It had been a bull market after all, but I beat the index by a decent margin looking back to any period (which is > 25 years).
I am a very concentrator investor. My biggest 2 positions constitute 73% of my portfolio and the biggest 5 constitute 90% - 1 technology (Apple), 3 financials, and 1 retail. I held investments for very long term and the top 5 all had triple-digit-percentage returns (Apple is now close to a 10-bagger in 8 years ... I bought right before Buffett did). I do have a few tiny positions for developing more familiarity on potential interests or to make experimental bets in new areas. But it's only so many I can follow because I don't want to spend my whole life just tracking markets. I ignore the general market 'cause I can only concentrated on small selective circles.
I think focusing on understanding the business prospects is much more important than digging through or predicting the last few % on the financials. I consider the downside of an investment more rigorously than the upside before I take a substantial position, and continuously seek opposing opinions for consideration during the holding period. I am generally more comfortable with company having low debt, decent growth, and high ROE via business moats. I believe that would more readily help to bail me out of a bad situation or more likely for time to work in my favor.
Lately (the last 5/10 years) I rarely lost a big amount (more than 10%) on my bigger positions (i.e., top 10). I have a relatively low pain threshold.
My latest error is ULTA. I took the position earlier in the year before Berkshire did but then started to feel uncomfortable with the prospect but didn't get out quick enough. I lost money getting out but I was glad I learned something useful for myself.
I don't copy anyone and try to think independently in my own frame. I think investing is quite a personal thing and different people have different strengths/weaknesses and different circumstances. I still like Apple and BYD although Buffett unloaded a good amount. It doesn't bother me and I am glad it propagates more variant comments for me to work through. I think everyone has his/her own good approach to investing. People chart their paths in their own unique ways of which they feel most natural about.
