Nick Train: Frequent trading and overdiversification lead to poor investment strategies

Investment Week

Speaking in a weekly webinar held by QuotedData, Train argued that portfolios “never really stay stable long enough to get the benefit of a good investment”, as a result of trading too frequently.  He noted that some investors tend to overdiversify their portfolios, which can often result in unintended changes in holdings ratio. “Suddenly [you] look up and realise, ‘I thought I was running a concentrated portfolio, but actually I have got 70% stocks now and I do not really know why I own half of them’,” Train stated. “We have disciplined ourselves to try and avoid those types of mista…

The full article is available here. This article was published at Investment Week.