Thursday, 16 July 2015

Portfolio Management for the Lay Investor by Warren Buffett

As a small investor, you got a chance to be in thousands and thousands of great businesses and their prices change all the time; so their relative valuations change and you can make the exchange at very low cost, close to nothing. You can always shift from one business to another.

You have a huge advantage over the big boys, as they cannot shift their business to retail or something else so easily.  You can rearrange your business empire in your portfolio that you have at a moment's notice at practically no cost.  You have a huge advantage which, sadly, many turn into a disadvantage.

There is nothing in the price action of the stock that tells you whether you should keep owning the stock.  What tells you to keep owning it is - what do you expect the company to do in the future versus the price you are selling now.and compare to the other opportunity which you think you know equally well and make the same comparison.

You can check your portfolio regularly to see how to optimise the stocks in your portfolio.  There is nothing to stop you from checking this daily.  However, don't do it too frequently.

@ 33 minutes
Warren Buffett's advice on portfolio management for the lay investors.

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Investment strategies and Portfolio Management

For finance or investment professional, change and challenge are constant, particularly in this volatile, complex marketplace. You are presented with diverse opportunities in emerging markets, real estate, hedge funds, derivatives, and other alternative investments. As the choices increase, shaping and monitoring investment portfolios becomes more complicated. Which investments will generate the highest returns without exposing you to excessive risk? In Investment Strategies and Portfolio Management, you will learn how to evaluate this fundamental issue and manage related risk to increase your effectiveness as an investment professional for your clients and your organization. This program examines specific investment areas such as stocks, bonds, derivatives, real estate, and global investments, giving you a solid foundation from which to build optimal investment portfolios and make better investments.

Through the Investment Strategies and Portfolio Management program, you will increase your effectiveness as an investment professional and gain financial tools you can immediately put to use for your clients and your organization. Wharton’s Finance faculty facilitates highly interactive dialogues that demonstrate hands-on applications of portfolio and investment strategies. They, along with noted industry experts, examine current issues such as the market outlook, investing in emerging markets, alternative investments, and hedge funds. All content is designed for you to use practically and effectively once you leave the classroom.

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