loftyd

Quite a useful section this, as I've been meaning to codify my own approach for 2011 anyway...

Historically I've always run a concentrated portfolio, usually with 5-7 stocks and often with one stock at > 50% of the portfolio. This has given decent returns (11 year average of >20% CAGR) and made it possible to manage the portfolio alongside work and family commitments, but it will need to change going forward as I rely on investments to support my lifestyle.

I plan to increase the number of stocks to somewhere between 15 and 20, with additional restrictions on individual holding size - a maximum of 20% in any one stock and the top 4 to be no more than 50% of the total. The aim is to allow reasonable concentration whilst limiting over-exposure. There's no drastic rush - completing this by the end of 2011 will be fine.

I expect I will continue with substantial exposure to oilies, as that is the sector I know best and there are still opportunities to be had. However I will deliberately look to broaden into other areas, partly to make sure I have alternatives to oil, should the sector run out of steam. I do undertake considerable research before committing funds, but do need to hone my approach further and also get to grips with researching non-UK companies.

My holdings tend to be longer term, rarely less than 1 year and frequently for several years. More time spent on research and a broader spread of holdings will probably reduce this somewhat, but I simply don't have the temperament to be a short term trader and see it as a guaranteed way to lose money for me.

Finally, I intend to do a (little) less lurking and aim to post about some of my investment ideas. After all, if I can't expose them to BB criticism should I really be putting real money into them?