facebookWhat is the maximum % of your portfolio would you allocate to one stock, and why? - Seedly

Bjorn Ng

Business Analyst at 10x Capital

14 Feb 2020

Stocks

What is the maximum % of your portfolio would you allocate to one stock, and why?

What's your thought process behind allocating a large % of your portfolio to one stock, and in what scenarios would you do this?

Discussion (17)

What are your thoughts?

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There are no strict rules, all depends on your risk tolerance.

And nobody, even professionals, can predict the course of a single stock, which is why

I (who still holds some stocks) discourage retail investors from buying single stocks.

Better stick with cheap and large ETFs, so you're much better diversified.

More of my thinking here: https://seedly.sg/questions/what-is-your-genera...

Lim Chun Long Jimmy

19 Jan 2020

Co-founder at PolicyWoke (Traded Endowment Policies)

It depends on how many % of your investible capital you are prepared to lose per stock. Use diversification to your favour. If you risk x% of your investible capital for each stock, it takes all y stocks to become $0 to wipe out your investible capital:

  • x = 1, y = 100

  • x = 2, y = 50

  • x = 4, y = 25

  • x = 5, y = 20

  • x = 10, y = 10

Gabriel Tham

18 Jan 2020

Tag Team Member at Kenichi Tag Team

For me its 10-15%. It all depends on your ability to handle volatility and risk. As long as you are comfortable, can sleep well, that is important when investing.​​​

Billy

18 Jan 2020

Development & Acquisitions Manager at Real Estate Private Equity

At my given age where I am able to handle a higher level of risk, I'd allocate 50% on a stock that is more volatile to hopefully help me grow my money at a quicker pace

I will go for 3 industry with weightage of 40-30-30 , with 40 as my favoured industry...

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