24 June 2017

Position Sizing

how to do position sizing for stocks

How to do position sizing for stocks

There are few ways to do position sizing (how much you should allocation into your portfolio)

One of the easiest way based on $100k investment will be:

Firstly, you can utilise 30% which is $30k to buy under-valued or fair value stocks. Do remember to look out for companies that pays out at least 4% in dividends (Well, would you rather put the money into your CPF special account which give you 4% interest or invest in companies which give you less than that?)

Secondly, reserve 30% of that cash ($30k) and invest when a mini crisis has arrived.

Last, you can then choose to show hand your remaining 40% cash ($40k) when major crisis came.

What above mentioned is one of the easiest way for position sizing. Do you have any other easy way to do position sizing? If yes, what do you think is a better approach?

Please comments below.......

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