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How should I allocate? How many stocks should I own? How much of one hot stock should I own?

Skip bonds. Equities do better, long term. That’s Rule #1.

Concentration works — if you know the company and, preferably, run it. Good entrepreneurs always do better than good stock pickers. That’s Rule #2.

Diversification works — if you’re not in control and are forced to read the company’s docs and listen to the hype on BubbleVision. That’s Rule #3.

How many stocks you own depends on how much time you have and, more importantly, whether you actually enjoy stock picking and stock following.

The upper end of how many stocks you should own is probably 15. After that, you should own a couple of  broad ETFs, e.g. the technology VGT and the total market VTI, which I like.

Some people don’t like having more than 10% of their portfolio in one stock. If the stock rises strongly and becomes more than 10%, they tend to sell. But that’s hard. A brilliant friend called Peter owns oodles of Facebook he bought very cheaply — between $20 and $40. It’s now over $200 and going higher…. It’s a big percentage of his portfolio. So now? He’s mulling. Nice place to be.

Yesterday I said back up the truck to Facebook. Today’s it’s falling. That’s me the stock guru. News: Star Wars actor Mark Hamill has deleted his Facebook account.  In a tweet, the actor said that the company’s CEO Mark Zuckerberg “values profit over truthfulness.” Fine with me if I own the stock and don’t read Facebook.

Some investors have more conviction (and more patience) than I do. I wasn’t as excited as several of my friends were on Facebook. By the time I got the message, Facebook’s price was higher than what they had bought it at. Ed is another brilliant friend.

My “portfolio” consists of syndicated real estate, stocks and ETFs and a small holdover of bonds and CDs. This collection provides re-financings (refis) and dividends to afford my extravagant (?) life style — without the necessity to sell stocks and incur big taxes. It’s also opportunistic. You can’t simply — buy everything day one and go play tennis.

My stock portfolio is skewed. It reflects my love for a handful of tech stocks, especially Amazon and Apple. But there are days — like today — when these stocks drop a little and the red on my screen screams. (I like that alliteration.)

I do believe in technology. Tech is scaleable because of Moore’s Law and the cloud. That’s better than most manufacturing where you gotta build brick and mortar factories.

In short, there’s no set strategy. You go with what you’re good at and family pressures. You should spend more time at home, traveling, visiting the grandkids, etc.

The good news is you don’t need to spend so much on things, like holiday homes. You’ve got Airbnb and VRBO. Experiences with the kids and grandkids count. Uno and Memories are cheap in dollars, but priceless for hours of fun.

In favor of a new life style

Travel tips

+ Phone calling overseas can be simple, or complex. Cheap or expensive. Personally I buy Verizon’s $10 a day, which kicks in when I need my phone. The whole business of calling and receiving calls overseas gives boredom a whole new meaning. The Washington Post did a piece, Should I get a SIM card or an international roaming plan? Enjoy. Click here.

+ American Airlines is way behind in the design of comfortable first class/business class. By contrast Hawaiian Air has lie-flat seats that are allegedly extraordinary. The best place to find out about seats is SeatGuru. They describe the monsters. And they warn you of egregious monsters. Click here.

+ Global Entry’s Renewal Interview Process Can Now Be Done in Minutes. Make sure your photo looks like you. Mine does and I float through. Susan’s doesn’t look like her and she gets caught on fingerprints, etc. Click here.

Dietary Supplements: Helpful, Harmful, or Harmless?

The article is from the University of California Berkeley Wellness. It begins:

Americans’ obsession with dietary supplements continues to grow, but so does evidence that many vitamin and mineral supplements do little to protect or improve our health. Several recent studies have added to the dismal overall track record for dietary supplements when they’re tested in rigorous clinical trials. Here’s a look at the latest findings.

What I know: some of the stuff is positively dangerous. What’s in the bottle doesn’t conform to the contents. The FDA has minimal (basically no role) in regulating this exploding industry.  You really believe heavily advertised Prevagen can fix your brain? Why CNBC runs Prevagen ads beats me. (Maybe they get paid?)

The Berkeley Wellness article continues:

One in three adults takes a daily multivitamin, the most popular dietary supplement in the United States. Unfortunately, multivitamins won’t cut the average person’s risk for heart attacks or strokes, according to a Johns Hopkins-led analysis in Circulation: Cardiovascular Quality and Outcomes in 2018.

Read the full article here.

Note to self: You gave up added salt. Now is the time give your up addiction to sugar.

I don’t know how Amazon does this

But when I google for the TV set one of my readers recommended, a box pops up on the right hand side from the amazon assistant. Pretty neat.

 

Shopping for a new TV set is almost as much fun as buying it. There’s a tenfold difference in price between the cheapest and the most expensive. I guess there’s a difference in quality.

Who needs a new camera when you do this with an iPhone and Photoshop? She’s called Zoe and she’s cute. She’s nearly 2 1/2. She calls me Papi.

She’s going to be the world’s best gymnast. Give her a few more weeks.

— See you tomorrow. Harry Newton

  • gerryb

    Zoe is lucky to have a great Papi.