I would have thought 30% a bit on the conservative side Julia. Do you have an uncomfortable feeling about the future course of the market?
Brian, I simply don't know what will happen. I don't think anyone does.
I think there are still a lot of jitters around as can be seen by the fall in markets every time there is a slightly bad news announcement.
My basic approach is to buy stocks in an uptrend and hold them until they turn. There are not too many stocks in a confirmed uptrend at present.
Those real blue chips in my p/f I will hold through dips, but not the mid and small caps.
I've just put half my cash into a TD for five years at 8%. I always keep that much approx in cash so am happy to lock it away for that time. Even if the cash rate goes up considerably I don't think I'll be too disadvantaged with the 8%. The balance of the cash is in an online at call a/c so up for feeding into the market if it stabilises.
As regards the shares you hold, they make sense to me. But its the weightings you have and the rationale behind them that I'm interested in. In my case the weightings have to a large extent been affected by the performance of the share prices since I bought them e.g. I bought WES very well and also bought into their capital raising and it is now my biggest holding at 12.6% - but do I want 12.6% of my share portfolio in WES?
I simply don't focus much on weighting. I may be wrong in this. But I'm happy to have more in stocks which are performing well.
Roughly I have about double in stocks which fall into the top 100, compared to mid and small caps.
Exception is Worley Parsons with which I am very overweight due to its increase in SP. I have no intention of reducing this unless something changes in the fundamentals.
Julia
Agree that best gains often come from outside top 100 companies. As do worst losses
The challenge is picking the winners and not the losers.
Indeed, gooner. Or, in my case, getting the timing right so as not to give back too much profit when selling. This happened to me with Oakton (OKN) where I had over 100% profit in about five months, but when I sold that had reduced to about 80%.
AFR had Campbell Bros as one of its "top 10 stocks for 2020" the other day.
Interesting. But 2020? Are you sure you don't mean 2010? I hope the latter.
I've owned this twice. Sold with healthy profit when the GFC was clearly going to happen and had concerns about their debt level for quite a while.
I suggest anyone contemplating a SMSF direct share portfolio at least read this article....Its not too dis-similar to those portfolios in here:
http://www.theage.com.au/business/the-complete-morons-guide-to-top-10-stocks-20091016-h1b6.html
Disclaimer: this is an external link to Sdney morning Herald article.....follow link at your own perril.This site an I take no responsibility ofr content beyonfd this post.
Thanks for that, condog. I'm always interested in Marcus Padley's views.
This is an extract from that article:
The only stocks that don't get an automatic pick in the top 10 include Telstra and Wesfarmers. Telstra because the only sex it offers is a yield, and by rights no one should invest in equities for that.
Equities are for growth in capital - ask any Yank - and if it wasn't for the performance of a protected monopoly called the Australian bank sector that has spoilt us into thinking we can have income and capital growth, the Australian retail investor would realise that.
High yield means low growth, which means a dull share price. Utilities, regulated gambling, property trusts, food, infrastructure, health care. I rest my case.
I've long held this view and will never buy anything just for its yield.
Wesfarmers doesn't get in because it's too complicated for most people. You'll find brokers very divided on Wesfarmers. Most are cautious about the big lash on Coles. That uncertainty, and the fact that it has about 10 different business units, puts it in the too-hard basket because no one really knows what it does. But the main bits are cyclical and I reckon that's enough at the moment.
Mr Padley's comment here about WES is interesting. I've only put it into my "probably buy" category since the Coles make-over seems to be finally bearing fruit. Looks as though they are on the right track at long last.
But against WES is possible downgrading of Bunnings when the new WOW owned hardware chain is up and running.
I think its a good starting point.....Have to agree with Julia, most my non-top stocks have been my star performers.....In relation to the risk though....risk is more a function to do with time and knowledge then the market cap of the company......B&B, Enron, Ansette, etc hmmmm not to safe, plus a few American and European banks.... do your research....knowledge lowers risk.
Yes, I agree about this. You were aware of some adverse reports which I missed re OKN, condog. Had I been up to speed with these, I'd not have given back as much profit. So, absolutely, timing is everything.