I agree. Its better to pick the stronger companies. If spreading the dividends is a great concern I would just save them in notice accounts and short term fixed rate bonds.
I did have 36 stocks when I started, but due to everything that has gone on I sold some and now have 27 - only a beginner but do believe quality over quantity and diversification can still be achieved with even fewer holdings in the future when I will try and add some ETFs.
3 Likes
I cannot see how anyone can possibly keep up with 30 companies (or more) if that is indeed the rule of thumb.
How can anyone collate sufficient research, knowledge and understanding for so many companies?
Further, itâs just not practical or (dare I even say) possible for anyone to be sufficiently well-versed in so many sectors IMO.
I have set myself a maximum of 10, though it currently sits at 6 and my ideal number is 7.
To each their own and this is merely my opinion. Being completely candid, I cannot even think of 30 truly amazing companies right now.
To summarise, I am not a massive advocate of over diversification!
4 Likes
Iâm going to be a rebel without cause in this Wild West World of investing by only investing in Four stocks.
2 Likes
If you can keep picking winning stock why bother with counting? if you find your not maybe think again.
1 Like
As many as you can realistically understand and follow in my opinion.
Personally i started with ETFs and slowly expanding into individual somewhat skewing it towards industries I understand.
3 Likes
I agree. ETFs are brilliant for long term passive investors who want to take the low maintenance approach but if you want growth I think you have to expand into individual stocks. If you want explosive growth you have to spread your money over lots of stock. And like you say the limit is how many can you realistically track and evaluate
I am still trying to figure out how to do it and with a full-time job itâs a bit hard 
The very first ETF that I looked at a bit over a month or two ago was VHYL. At the time itâs projected growth was in the realm of 10-15% over a year with over 4% dividend yield. This looked super good, so i went all in on it. I think it grew like 20% in a month but the market is crazy so w/e. The challenge that i am facing is that I am simply struggling to find a lot of dividend stocks that are projected to outperform it. I do understand real-estate, tech and banking but i have no clue if i should get involved in high risk high reward things like oil, airline, insurance or tobacco.
1 Like
I donât know what to make of the market at the moment.
I spent a lot of time researching investment before I got involved with Freetrade, I had other investments but not a portfolio, Its nothing like I expected Iâm getting crazy returns on stock I own on Freetrade and Revolut and it has a temporary feel because it simply canât be this easy. In respect to high risk I think its lower your % invested according to your confidence, probably best very low to start until you can prove your judgement. Just my opinion
2 Likes
On an unrelated note: I heard revolut recently launched a decent investing module for their app and were giving it quite a bit of attention - how do you like it compared to FT?
Overall its great. The saving vaults, crypto exchange and gold buying option make it good. But my loyalty is with Freetrade as far a shares go and if I could get all the stock revolut has on here I would stop buying shares there as well.
Explosive growth seems to be more on options trading. Especially for accounts under ÂŁ50k that want opportunities for explosive growth, having mastered at least a few areas of options first. Purely based on indicators and alongside a trading team. Not some 29 yo cowboy on Instagram. An actual team which offers trades to the style that suits you best.
Profits from options then funnelled into a longterm shares isa like FreeTrade. If the S&P 500 takes 10 months to gain 3%, a basic options Put or Call trade could get you 3% that morning. Saving you 10 months. Even very few options trades made throughout the year could help offset that 10 month wait for 3%.
Buy and hold is a great longterm strategy that will also get burned many times unless protected by trading the down cycle as well.
So far, I fail to see the value in individual retail investor research. You NEED pro indicators and pro mentoring and pro insights. Anything else is a blind guess. By the time youâve spent three weeks researching something, the entire stock is most likely heading somewhere else. Purely b/c of the time it takes vs the reward of what most are buying. Spending weeks if not months of your time without pro indicators to invest ÂŁ500 is questionable. The pro indicators for individual retail investors to me seem essential, in knowing exactly what market you are in - in that exact moment. Itâs useless to me after doing one month of research into say L&G, to find out that the time to enter aggressively was 3 weeks ago. (Hypothetical example).
If your portfolio consists of 4 stocks or 20 stocks, how on earth are individual retail investors indicating when they know which ones to rebalance and when?
March 18-23: John Thomas, âaggressively buy Nvidia, AMD, Skyworks and Qualcommâ. Then in May: âtake 50%+ profit off the tableâ. - Those indicators & approach for those market conditions are priceless.
I would end with saying that ANY paid service from big names that offers trade alerts and the bigger picture is most definitely a necessity.
1 Like
The only minor âcorrectionâ here is that influencers usually do quote multiple such paid sources which does in fact make them credible as long as you use those videos to consume the data and not their opinion.
On a related note: which paid analytical sources would you recommend?
I didnât say anything about options. What I call explosive growth is buys like ITM Power bought Feb 20th and up 211% Greatland Gold bought Mar 10th and up 51% NIO bought May 28 and up 41%. I not getting that on a ETF
I can not recommend anybody, I can however recommend that pro mentoring and indicators are needed, though I did sit through a 10 hour zoom webinar recently and many individually selected longterm success investors & traders spoke and provided examples on practices and insights all day long. There is no way on earth a retail investor with no paid help can navigate investing without pro indicators. Blind guesses will get you burned. Even for the longterm investor. It took 13 years for the tech crash of 2000 to genuinely recover. All those retail investors in â98 â99 â2000 burned for 13 years.
We all need an understanding of which environment we are investing into at the given time. Without knowing that, we are blind.
Everyone has made 15% to 50% since March. If you havenât then you are doing something wrong. The only difference is that the pros have also taken money off the table and they continually position themselves for new environments regularly. That is where the live mentoring or indicators come in. Indicators may not help showing what 6 months ahead looks like, it will however limit the risk on knowing if this month is risk on or risk off.
I was told aggressively to take all my equities off the table in the first week of February 2020 and to buy gold and sit on cash by John Thomas. That is what he done and what he advised his clients on ALL levels to do. Iâm not saying that will always be the case, but even if retail investors have 4 stocks or 20, you need to limit downside risk by knowing your entry points and your rebalancing points.
Unfortunately I am not a level yet where i can spare even ÂŁ100 /mo on âpro mentoringâ
With a buy and hold long term strategy you donât need paid advice, just some common sense, discipline and commitment. One of the founding principles of Freetrade was to remove the barriers to trading for everyone and that means no broker charges and no expensive advice.
8 Likes
I truly can not agree that investing is based on common sense. So so many excellent people run great companies for great causes and perform awfully. There are so many talented CEOâs that fail, often for no reason other than the sheep flocked to another business or another sector.
This stuff requires indicators and yes common sense can help you pull the trigger also but common sense should be 5% of the decision if not less then that. Think how many people used their common sense and built up £5k positions in Nokia⌠little did they know something else was about to happen.
Youâre talking about something completely different to what most people want which is just to set and forget, for which ETFs and high diversity is a must. Most people arenât after âexplosive growthâ, theyâre after a way of making their money go further than a cash savings account.
9 Likes