Clem Chambers Newsletter: Bets on Sprint and ValueClick

PUBLISHED: 28 Aug 2012 @ 21:50 | Comments (0) | More info about Clem Chambers

It’s been a pretty bearish week. This is unsurprising, as it comes after a major rally, one that has paid off well.

Even so, it’s never nice to lose for days in a row, even if it is small amounts.

I’ve found myself buying a couple of US shares as a spread bet experiment – out of my “crazy punting” fund. Sprint because it looks cheap and ValueClick because Facebook needs a good advertising platform and this might be it. Google bought DoubleClick, after all.

Sold the second half of my Pace position, purely because I don’t do “hanging on” with stocks. I buy them cheap when they are hated and sell them when they recover.

I just don’t run with the pack. I’ve been trying to develop my style and encourage myself to hold for longer, but my research suggests what happens then is my profits concentrate into a few huge winners and I thereby lose my diversification – and also my sleep.

For instance, a fat but old portfolio of mine, long since solid, is still tracked. Its results were very slow over the decade I bought and held, but all the profits were in Cape, which I bought at 15-30p. Of course, I don’t know what I would have bought with the profits from many takeovers, but it is indicative that buy and hold leads to portfolio concentration.

I will never believe in portfolio concentration.

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