Hello,
Thank you for the great service of your website. I'm starting out implementing your insights and invested in the recommended Companies BHI, CSH, HP and SCL so far.
Like many of your readers I'm not totally clear about the time to sell these stocks. I assume the best point to rebalance the portfolio and sell the stock is when the suggested Graham price is reached. It would be great if you could clarify this once more.
A second question: So far I have been following Swensen's passive Investment strategy, investing in Index funds (Vanguard ETFs) and diversifying across countries, in REITs and bonds. To implement Graham's Stocks I sold part of my S&P 500 ETF and replaced it with the 4 companies given by your screener. Is it sensible in the long term to shift the whole portfolio towards Graham's stocks or rather advisable to keep diversified in more countries (through ETFs)?
I wonder about the concentration in the American market.
I highly appreciate the time you put into this website and look forward to your further develpoment.
Thank you for all your effort!
Andrej
Submitted by klempo. Created on Monday 28th January 2013. Updated on Wednesday 6th March 2019.
Diversification, selling and sizing
Hello klempo,
Please see Graham's notes on selling stocks. The subject of position sizing is addressed in detail in Quick Reference - Graham and Serenity.
Warren Buffett and Diversification covers your last question.
As mentioned in How To Build A Complete Benjamin Graham Portfolio, investing in index funds requires almost zero effort whereas stocks — even defensive ones — require some effort for verification and maintenance.
Thank you for your thorough
Thank you for your thorough answer and your warning about the SCL investment. I already corrected my mistake and will pay more attention in the future.
Keep up the great work!
when to sell a stock ?
Warren Buffett said once that the value of a stock is all its future discounted cash flow. So you probably can add up these cash flows (dividends plus earnings per share) to the actual book value ? I bought SCL and am holding to it tight until it reaches my calculated intrinsic value. Take care.
Yout Screens
All my gratitude to you, the builder of this marvelous site ! Exceptionally profitable. All my thanks also to Ben Graham !
Thanks to Graham
Thank you, Aspenhawk!
Please see Graham's notes on selling stocks.
Graham spent nearly 50 years of his life developing and back-testing these strategies. He actually avoided things he could have easily done as Chairman of the Graham-Newman investment fund — such as meeting company managements — so that he could develop investment strategies that anyone could use.
Serenity could not exist today but for Graham.
Update
DCF has been covered separately in 2016.
Thank you for your forum post!