To win in the stock market in all market configurations, investing in quality stocks is not enough. They must still be uncorrelated with each other, that is, they do not perform well or poorly in the same periods.
Three tips for building a truly diversified portfolio.
First, the number of lines
It must be consistent with the amount of your portfolio and your level of expertise. Income he recommends ten equally balanced rows if you’re just starting out, 20 to 30 rows for experienced investors. In addition, performance will be too diluted and daily monitoring problematic.
Deuzio, gradually diversify
This topic is often discussed at lerevenu.com, but it is an essential one. You know my opinion. I am a big supporter of planned investment, which the Americans call the DCA (Dollar Cost Everaging) method, a strategy that consists of investing the same amount in stocks every month.
When prices are high, you buy few securities; when they are low, you buy more. This allows you to average your cost prices and optimize your profits over time. The method primarily enables restful sleep. If prices go up, you are happy because your past investments are increasing in value. If they go down, you’re just as happy because you’re buying back at a lower price.
Third, combine investment supports
Income advocates direct investment in live securities. Because it is the most intellectually stimulating strategy and above all the one that gives the best results. Which is not to say that you shouldn’t invest through complementary funds or ETFs, in foreign markets, or “play” on niche sector themes.
Discover more tips on how to take advantage of the current rise in the CAC 40 in our video.