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This is the eternal question, which opposes the disciples of Benjamin Graham and those of Warren Buffett.
Personally, I don't consider myself good enough to concentrate risk on just a few positions like Buffett. And then you also have to have a lot of risk tolerance if the portfolio has few positions, because a big variation in one of them has an immediate impact on the performance of the whole.
Some say that having a very diversified portfolio with a lot of positions takes a lot of time to follow. I retort that it is the opposite. With few positions, I would be so afraid of each of my lines that I would analyze them constantly, I would follow the price movements every day, I would freak out at the slightest bad news, I would read the financial reports from A to Z… By diversifying, I focus on a few specific criteria that I know well and I apply them to all my values. I do not need to dwell on each line because even a significant drop would have little impact on the overall performance.
On the contrary, it is true that the more titles you have, the more in theory the chances of doing better than the market diminish. But frankly, I gave up on this idea a long time ago, because very few people manage to do it over time (apart from geniuses like Buffett). And my performance has never been as good as since I stopped wanting to beat the market... It is indeed better to concentrate on your principles, your methods and keep discipline, rather than focusing on what others are doing.
Finally, and as DSwissK said, it is true that having a lot of positions costs a lot in fees. So it is necessary to invest large amounts, which is not necessarily possible at the beginning. So there is a phase where it is necessary to start with a portfolio that only has a few lines anyway.
Hello DSwissK
This is an interesting question. I used stops when I started out, when I was more technical analysis oriented. But after several bad experiences I abandoned this method because sales were triggered unexpectedly intra-day following a sudden drop in price, followed by an equally sudden rise. I will be told that I was perhaps setting the stops too high… certainly, but what is the limit then… if we set it at 20% I find that it is nonsense because as long as we invest in quality growing dividends a drop of 20% (is this already possible…?) should rather represent a buy signal than a sell signal.
In short. I don't like a machine to decide for me, I prefer to keep control. And anyway I'm a buy & hold. The only reason that pushes me to sell is not the price, but the dividends. The day when the stock markets invent a stop order when a dividend remains flat for more than 4 consecutive quarters, then maybe I'll be a buyer
but we are still smart enough and not lazy enough (although...) to need that...Thank you for sharing your portfolio. You already have some great stocks, and above all you learn from your mistakes and are moving in the right direction. I was indeed surprised to see FTR in this portfolio, but as you say, it is often the classic mistake when you start investing in dividends. We are only interested in the yield, without looking at the company's ability to ensure the payment of distributions. I see that FTR still has monstrous payouts, which actually reminds me of its sister company CTL in many ways. The difference is that the latter was one of the dividend aristocrats, with a decent distribution ratio at the time.
As for financials, like CSGN, I'm not a big fan of them, because they are by definition cyclical, so they have a lot of trouble ensuring the continuity of dividends. ZURN is also in this sector, but insurance companies are still more stable than banks. It's a stock that I've had my eye on for quite some time and I'm becoming more and more interested in it.
I analyzed HP, it is interesting, but too volatile for my taste unfortunately.
I don't know ASCN too much, it also seems quite volatile to me, perhaps a little expensive, and with little dividend history.
The other stocks you submit follow a dividend growth strategy perfectly.
after analysis, I decided to add NWN and WGL to the Global Dividend Growers
HP is too volatile for my taste
Interesting. There are indeed many similarities with Global Dividend Growers.
It's true that I'd left HP out until now because of its volatility, but looking at the fundamentals I'm thinking I could also add it to the GDGs. I'm also going to analyze the other stocks that make up the portfolio presented on seekingalpha and see if they can also feature in my first strategy.
Thanks for this useful information!
Request an appointment with a postfinance advisor, by calling them or going directly to a post office.
Additional information about Postfinance that may interest more than one: they can participate (up to a certain point) in the transfer fees of securities requested by your current bank to go to them… This team is really very strong. In addition, it is the confederation that is behind it… so in terms of risk… it holds up!
Ah, this table is excellent! Too bad, the only thing missing is the money transfer fees. It makes me laugh to see Direct net in last position… I started with them in 2000 and left shortly after for e-sider (now tradedirect), finding them much too expensive.
I came across the following document which dates from 2011 but offers an interesting comparison:
I hope the link works… if not I have a pdf available
Hi Jean-Louis
You are right to mention Postfinance because I have been eyeing them for quite some time precisely because of the free custody fees. When you start on the stock market you don't look at this aspect too much and you are mainly interested in transaction fees. This is normal: portfolio to set up, lots of securities to buy, and tendency to make quite a few transactions. Subsequently, as you gain experience, you become more conservative, you buy a little less, and above all you sell a lot less. But on the other hand, you have more capital invested, so more custody fees. And there it even becomes scandalous at certain institutional banks.
Swissquote is not too bad from this point of view because the transaction and custody fees are correct. The latter are even capped at CHF 50. Tradedirect is not too bad either, but the fees are capped at CHF 100. In many banks these fees are not only expensive, but not capped and you can lose a lot of money there.
Postfinance is only slightly more expensive than Swissquote for transactions, but since custody fees are free, buy&hold investors are more than happy with it. In addition, cash transfers to a current account are free, which is very practical when you are a rentier and want to withdraw your dividends...
In short, Jean-Louis, you only confirm all the good things I think about Postfinance recently and it is possible that I will switch to them in the future.
I use e-trading from Postfinance. It is very practical if you also have a current account at the post office. The purchase costs are around 35 chf (including taxes and stamp duty) for an amount close to 5000 chf. No management fees or unacceptable conditions like at SaxoBank. The interface is clear and accounts in chf, euros and usd are automatically opened upon registration.
Happy Sunday
Jean-Louis
It's true that the brokerage fees seem cheap, but since I'm a buy&hold investor, with little movement in my portfolio, what bothers me the most is this:
- Saxo Bank (Schweiz) AG does not charge account maintenance fees. if the account has at least one trading activity (e.g. purchase/sale of securities) in the previous 6 months or in the case of an available cash balance greater than CHF 25,000 (or equivalent in another currency).
- For accounts that do not meet the conditions mentioned above, a semi-annual account maintenance fee of CHF 100 will be debited (January and July).
In case the amount available in the account does not cover the account maintenance fees, Saxo Bank (Schweiz) AG may sell positions in the deposit to cover the account maintenance fees. (on this subject see the General Conditions).
200.- account maintenance fees per year (if no movement) which can also trigger a sale of positions, that bothers me a little...
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