if you invest in a maximum amount in one stock, then you have to wait to succeed in that stock.So easy to switch your money from one stock to another stock. If you make money in one stock then you can easily that money put in the other stock. If you have the maximum stock then you have the maximum flexibility of your portfolio.So if you have maximum stock then you have a maximum probability of multi-bagger stock. If you think out of 10 stock 3 will be become the multi-bagger then in between that only one become the multi-bagger. peter lynch says, ” you can not be sure on a stock that will become the multi-bagger.So keeping maximum stock means your probability of high of getting multi-bagger stock, if your analysis is good. you can do more maximum and minimum also as your wish. In your portfolio, the author says, ” you can buy 3 to 10 stock in your portfolio.so you have to analyze each and every stock individually. peter lynch says, ‘ diversification is good but if you buy 20-30 stock only on diversification is not good for your portfolio.for example, if an index fund gives you the 10% return, then your return is maximum than the 10% of return i.e. If you are spending time and effort picking stock, then you have to do better than the stock market index fund.If your long-term record is worse than a saving account, then you have to confirm your techniques of investment have flowed ( wrong).so 10 years continuously 25-30 % return is impossible.
It may happen you can earn 30% but in some years you earn 2% also some years -20% also.Because peter lynch is record is 29% in continuous 13 years. In the stock market, If someone offers you a 25-30% return from the stock market is unrealistic.Part-3: The long term view:-One up on wall street book chapter 16 In chapter 16 we see how to design a portfolio in one up on wall street book. Hello, friends in today’s article we see chapter 16 of one up on wall street book.
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