80/20 Principal – Stock Portfolio
I’ve been reading the “80/20 Principle” by Richard Koch and it has me thinking about my portfolio. Does it have a large distribution of winners versus losers?
After looking over my notes, I’ve decided that yes it does. There is a smaller portion of my portfolio that makes the most money versus the number of stocks I’ve bought/sold.
This makes for some interesting pondering. I invest in more stocks that lose money than make money. Yet, the ones that make money make up the difference plus add profits. So, this just proves that it’s not how many winners versus losers that you have, but how well the real winners do.
To wrap up this odd post. Cut your losses early, don’t buy into stocks that are losing money and invest more into the winners while they are winning.
Do you use the 80/20 Principle when you invest? Let me know in the comments.
Thanks for reading. Happy Trading!
Tags: 80/20, investing, Rules, stock market, thoughts
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