I do vary my stock holdings versus cash, but I limit my cash to 20 % of my stock portfolio at maximum because I have been generally good
at picking stocks over the years.
At this point, if you still think there really are people who are
experts at picking stocks, I've got a bridge to sell you in Brooklyn.
While we know that most experts can't beat
monkeys at picking stocks, every once - in - a-while a Warren Buffett comes along.
Along the way, he and Charlie Munger got better
at picking stocks and whole companies for investment.
Scientific research has shown that virtually nobody is good
at picking stocks, timing the market, or predicting what the market will do in the future.
It makes sense — if you're good
at picking stocks, you're not going to want to take $ 300,000 from someone and only receive compensation for a dozen or so hours worth of billed labor.
Mebane Faber, «You probably think you are good
at picking stocks (and investing in general).
Fund families that have been generating positive alpha will almost certainly attribute their success to skill — either their skill
at picking stocks, or the skill of the fund managers they chose and their skill in selecting them.
It's low - cost, it's optimized, it outperforms pretty much anyone who thinks they're good
at picking stocks.