Instead of investing in only a couple of great stocks – and missing out on other potential big winners – why not invest in all your top choices?
Here’s how to do it with the least risk …
Let’s say you’ve found 10 companies with substantial upside. Divide your hypothetical 10-company portfolio into two groups. Group 1 should include the companies with the highest upside. Just as important, none should be likely to head south (given their track record and the market they’re in). Group 2 should include the companies with either lower upside or bigger downside than those in the first group. Either way, you’re not getting enough potential gain for the risk you’d be taking.
If you have $90,000 to spend on this 10-company portfolio, spend two-thirds of it (twice as much) – $60,000 – on the first group and one-third – $30,000 – on the second. This way, if any of your big winners emerge from the second group, you participate in the profit … and you still have time to put more money into these high flyers.
Then sit back and watch your money pile up.
(Ed. Note: Andrew Gordon, ETR’s financial expert, is the editor of our new investment service, The Wealth Advantage. Join now and you’ll get a free special report on Andrew’s specific “finds” – companies that have the very real potential of giving you up to 1,000 percent on your investment.)