How to Make a Million – Slowly

Chapter 6

Constructing a portfolio

Few investors apply much consistency or logic to the creation of their personal investment portfolios. Your average investor will usually hold a range of stocks, with substantially differing values, delivering wildly varying yields, with no obvious theme or structure. Often there is a mix of a few small-value privatisation or mutualisation holdings, a number bought on the basis of ‘well worth a punt’ tips from city columns, ‘gossip’ recommendations which have done the rounds at the 19th hole of the golf club, perhaps a share bought through sitting next to a director on the return holiday flight, maybe the favourite retailer frequently visited by your wife or partner, plus a number of personal hunches. ...