4 ms·

Your note on diversification reminds me of a video I recently saw from Eric Sprott. In it he said the following. "I focus in on things. I get deep into things

by JSig 16y ago

Your note on diversification reminds me of a video I recently saw from Eric Sprott. In it he said the following. "I focus in on things. I get deep into things that I like. I dont worry about diversification. I think it was Warren Buffet who coined the term 'diworsification'. I dont belive in diversification. For example on the long side of our funds we are well through 70% into precious metals. For me, I am probably into 70-80% gold. For me it does not bother me because I know that is the place where I have to go." He is a man of conviction.

gte910h 16y ago
Depends on life goals. If your primary goal is to amass further wealth, large bets on single items/industries can pay off very well. However, if your goal is to not lose wealth, then diversification is a very good strategy. The OP is in the latter school with these particular investments. Additionally, I find it ironic you bring up Buffett: Berkshire is diversifying out of insurance :D http://www.financialexpress.com/news/warren-buffett-scouts-for-buys/755525/ http://www.financialexpress.com/news/warren-buffett-scouts-f... >Foremost, though, was his acknowledgment of the need for Berkshire to expand its non-insurance businesses, a broad collection that most prominently includes the railroad Burlington Northern and the electric utility MidAmerican.
- jsarch 16y ago
  Expanding on your advice: when diversifying it helps to not throw darts. It may be best to not have investments only in tech, auto, health, etc., but it's quite another to randomly choose a company or two in different sectors. Unsolicited advice ;-): * Tech: ARMH over MSFT over FB (phones/tablets need to be low, low power and P/E of FB seems egregious) * Auto: VLKAY over F over GM (100MPG TDI trumps "made in USA" trumps bankruptcy) * Health: ILMN (NGS is the next $100BB market http://bit.ly/fYehBI http://bit.ly/fYehBI ) (OP: I'd be more than happy to be a "trial run" for your angel investing. ha! ;-)

by JSig 16y ago

gte910h 16y ago

Depends on life goals. If your primary goal is to amass further wealth, large bets on single items/industries can pay off very well. However, if your goal is to not lose wealth, then diversification is a very good strategy. The OP is in the latter school with these particular investments. Additionally, I find it ironic you bring up Buffett: Berkshire is diversifying out of insurance :D http://www.financialexpress.com/news/warren-buffett-scouts-for-buys/755525/ http://www.financialexpress.com/news/warren-buffett-scouts-f... >Foremost, though, was his acknowledgment of the need for Berkshire to expand its non-insurance businesses, a broad collection that most prominently includes the railroad Burlington Northern and the electric utility MidAmerican.

jsarch 16y ago
Expanding on your advice: when diversifying it helps to not throw darts. It may be best to not have investments only in tech, auto, health, etc., but it's quite another to randomly choose a company or two in different sectors. Unsolicited advice ;-): * Tech: ARMH over MSFT over FB (phones/tablets need to be low, low power and P/E of FB seems egregious) * Auto: VLKAY over F over GM (100MPG TDI trumps "made in USA" trumps bankruptcy) * Health: ILMN (NGS is the next $100BB market http://bit.ly/fYehBI http://bit.ly/fYehBI ) (OP: I'd be more than happy to be a "trial run" for your angel investing. ha! ;-)