Would you put all your eggs in one basket?

[JohnDe]

I have followed two old sayings from a very young age; "land, they're not making it anymore" and “don’t put all your eggs in one basket”.

I have several baskets. A couple for different share portfolios, which have done quite well. Another for property, this has been outstanding. A basket for my business, which has had some tough times but has been good for us. And a couple of baskets for risk taking.

Property and owning a business have been my best investments. However, like everything, timing is key. I entered the property market at a very low level, struggling with rental income and mortgage payments but I hung on and reaped massive gains with further risk by developing the property.

Owning a business was another risk, struggling and stressed through the process of building a client base, we came through with a stable and reliable income.

Which leads me to another old saying "Nothing worth having comes easy".

 

[farmerge]

I have followed two old sayings from a very young age; "land, they're not making it anymore" and “don’t put all your eggs in one basket”.

I have several baskets. A couple for different share portfolios, which have done quite well. Another for property, this has been outstanding. A basket for my business, which has had some tough times but has been good for us. And a couple of baskets for risk taking.

Property and owning a business have been my best investments. However, like everything, timing is key. I entered the property market at a very low level, struggling with rental income and mortgage payments but I hung on and reaped massive gains with further risk by developing the property.

Owning a business was another risk, struggling and stressed through the process of building a client base, we came through with a stable and reliable income.

Which leads me to another old saying "Nothing worth having comes easy".

@JohnDe Exactly

 

[divs4ever]

Which leads me to another old saying "Nothing worth having comes easy".

i disagree there , but the hard yards is the way to start out , the easy bits may or may-not come later (don't count on them , but don't waste them either )

 

[JohnDe]

i disagree there , but the hard yards is the way to start out , the easy bits may or may-not come later (don't count on them , but don't waste them either )

"Nothing worth having comes easy".

I suppose it depends on the individuals understanding or experience of the phrase. For me it basically means that achieving something valuable typically requires hard work, dedication, and perseverance, and it is often attributed to Theodore Roosevelt, who actually said, "Nothing in this world is worth having or worth doing unless it means effort, pain, difficulty". The common paraphrase emphasizes that significant goals demand significant effort and a willingness to overcome challenges, which I and some of my family members have experienced.

 

[farmerge]

"Nothing worth having comes easy".

I suppose it depends on the individuals understanding or experience of the phrase. For me it basically means that achieving something valuable typically requires hard work, dedication, and perseverance, and it is often attributed to Theodore Roosevelt, who actually said, "Nothing in this world is worth having or worth doing unless it means effort, pain, difficulty". The common paraphrase emphasizes that significant goals demand significant effort and a willingness to overcome challenges, which I and some of my family members have experienced.

Similar to the "Free Lunch" easy come but not earnt and therefore not really worth anything.
Hard yards and graft are worth everything in success, rather than having it all handed on a plate.

 

[frugal.rock]

"Why Diversification Is Failing in the Age of Passive Investing"

Why Diversification Is Failing in the Age of Passive Investing | Investing.com AU

Market Analysis by covering: S&P 500, Microsoft Corporation, Apple Inc, NVIDIA Corporation. Read 's Market Analysis on Investing.com AU.

au.investing.com

 

[frugal.rock]

View attachment 207844
.
and, frozen since February 2024

Macquarie says investors will receive back 100 per cent of the money they put into Shield by the end of this month.

The corporate regulator also accepted a court-enforceable undertaking from Macquarie Investment Management to ensure it pays members 100 per cent of the amounts they originally invested in Shield, less any amounts withdrawn.

The investment banking giant said in a statement that affected investors will receive the funds before the end of this month.

Macquarie coughs up $321 million payout after superannuation failures

Macquarie commits to repaying thousands of Australians who invested hundreds of millions of their retirement savings in the collapsed Shield Master Fund amid admissions it contravened the Corporations Act.

www.abc.net.au

 

[Dona Ferentes]

reputational damage... priceless

 

[farmerge]

reputational damage... priceless

Nothing like bad publicity to make a quick change, and the peasants can now sleep a little easier tonight, unlike the top brass who are now looking at a bottom line less $321m less.

 

[DrBourse]

I have purposely avoided posting into this forum in the past, as I know my Contrarian Processes will aggravate a few within the ASF..

But for the sake of the Beginners & Newbies I feel the time is right for my post, that will, I hope, prevent them from turning into Sheep & Lemmings… Remember, the Beginners & Newbies are the smart ones..

Diversification, as a Theory suggests for example, that you should use a % of your cash for one stock, then you should look for another stock in a different Indicie or Group, then repeat that process until you have the required number of stocks…

So if you used 100% of your cash, and if you have say 10% in each of 10 different Indicies, Groups or Stocks, etc, then half of your holdings may drop in value, the other half may save your position by rising in value….. In this example the net result, in theory, could be a Zero Profit…

Diversification will usually only Limit a Traders Profits… Diversification suggests that you should try to “limit or Average Down” your losses by “Spreading your Risk” through Investing or Trading in a range of Stocks from different Indicies, Groups, etc…

Why on Earth would you do that, if for example, you feel that the first stock you bought was going to be very profitable, BUT, because of this ‘Magical word Diversification’ you now must spread your Risk into stocks you may feel are not going to perform anywhere near as well as your first choice Stock…

If I can only see one or two stocks that look positive for a Short-Term Trade, or as a Long-Term Investment, I may use all my available spare cash on those one or two stocks…

The problem is that diversification can be a terrible form of risk management for the average Share Market Trader. While it works well to reduce risk in an Investment Portfolio containing multiple asset classes, it’s not effective on a portfolio containing just shares…

Many ASX investors believe that by “diversifying” their share portfolio between 8, 10 or even 15 different companies they are reducing their “risk”, but this really isn’t accurate…..

"Wide diversification only guarantees ordinary results." - Charlie Munger…

Buying multiple ASX listed companies is a great way to prevent one “bad apple” from causing a game-ending loss (although it also prevents one great stock from significantly increasing your portfolio’s return), but what happens if the whole stock market falls? The answer is simple; your portfolio’s value will also fall….

The current Economic Climate is very unpredictable – Don’t get involved with too many stocks at the same time...

If you are Investing in 8, 10 or 15 it is not easy, while you are winning and watching your profits grow on say 2 or 3 of them, the others can quickly reverse and obliterate any profit you thought you may have had….

In the current Economic Climate why not trade 2 or 3, have all charts and all Market Depths on multiple screens at the same time, and watch them “like a hawk”….

In todays’ market, I personally, hold one Blue Chip and One Penny Dreadful, I have alarms set on both, and I watch them both all day, every day…

Diversification is a “Nasty Word” as far as my Trading goes…

IMO, the word Diversification should be DIWORSEIFICATION…

Diversification should be applied to your Share Investments, but even then, only in the correct Economic Conditions, now is a time to be cautious …

The Economic Clock may help your Stock Selection Process, and more importantly The Economic Clock may help the Timing of your entry into those Stocks…

Cheers…

DrB.

 

[DrBourse]

I have purposely avoided posting into this forum in the past, as I know my Contrarian Processes will aggravate a few within the ASF..

But for the sake of the Beginners & Newbies I feel the time is right for my post, that will, I hope, prevent them from turning into Sheep & Lemmings… Remember, the Beginners & Newbies are the smart ones..

Diversification, as a Theory suggests for example, that you should use a % of your cash for one stock, then you should look for another stock in a different Indicie or Group, then repeat that process until you have the required number of stocks…

So if you used 100% of your cash, and if you have say 10% in each of 10 different Indicies, Groups or Stocks, etc, then half of your holdings may drop in value, the other half may save your position by rising in value….. In this example the net result, in theory, could be a Zero Profit…

Diversification will usually only Limit a Traders Profits… Diversification suggests that you should try to “limit or Average Down” your losses by “Spreading your Risk” through Investing or Trading in a range of Stocks from different Indicies, Groups, etc…

Why on Earth would you do that, if for example, you feel that the first stock you bought was going to be very profitable, BUT, because of this ‘Magical word Diversification’ you now must spread your Risk into stocks you may feel are not going to perform anywhere near as well as your first choice Stock…

If I can only see one or two stocks that look positive for a Short-Term Trade, or as a Long-Term Investment, I may use all my available spare cash on those one or two stocks…

The problem is that diversification can be a terrible form of risk management for the average Share Market Trader. While it works well to reduce risk in an Investment Portfolio containing multiple asset classes, it’s not effective on a portfolio containing just shares…

Many ASX investors believe that by “diversifying” their share portfolio between 8, 10 or even 15 different companies they are reducing their “risk”, but this really isn’t accurate…..

"Wide diversification only guarantees ordinary results." - Charlie Munger…

Buying multiple ASX listed companies is a great way to prevent one “bad apple” from causing a game-ending loss (although it also prevents one great stock from significantly increasing your portfolio’s return), but what happens if the whole stock market falls? The answer is simple; your portfolio’s value will also fall….

The current Economic Climate is very unpredictable – Don’t get involved with too many stocks at the same time...

If you are Investing in 8, 10 or 15 it is not easy, while you are winning and watching your profits grow on say 2 or 3 of them, the others can quickly reverse and obliterate any profit you thought you may have had….

In the current Economic Climate why not trade 2 or 3, have all charts and all Market Depths on multiple screens at the same time, and watch them “like a hawk”….

In todays’ market, I personally, hold one Blue Chip and One Penny Dreadful, I have alarms set on both, and I watch them both all day, every day…

Diversification is a “Nasty Word” as far as my Trading goes…

IMO, the word Diversification should be DIWORSEIFICATION…

Diversification should be applied to your Share Investments, but even then, only in the correct Economic Conditions, now is a time to be cautious …

The Economic Clock may help your Stock Selection Process, and more importantly The Economic Clock may help the Timing of your entry into those Stocks…

Cheers…

DrB.