A reader left a comment asking how I define cap sizes.
Not sure that I have anything enlightening here;
Mega cap $100 billion and up (maybe this should be $150 billion)
Large cap $20 billion to $100 billion
Mid cap $2 billion to $20 billion
Small cap $500 million to $2 billion
Micro cap less that $500 million
I'm not sure if these are right because candidly I don't look at cap size this way. I am more concerned about the average cap size of the entire portfolio. Earlier in the cycle I want the market cap of the portfolio to be smaller and for it to get larger as the cycle carries on and matures.
To get smaller in the portfolio obviously you would buy some smaller stocks but a portfolio that owns 50 stocks all greater than $50 billion (to pick an extreme example) will not be changed by adding one $250 million stock.
Even if all that is used are index funds I think the market cap size of the portfolio is something that should be managed just like yield and volatility.
Wikinvest Wire
6 comments:
Roger,
I have seen a lot of bloggers on here including you talk about owning CGM FOCUS FUND. With the market up 800 pointsd in lasrt few weeks this fund is down 15% in same time. Any clue what has turned this fund dowen so sharply?? Example - today market up 150 and fund down 5%. Thoughts??
first things first I have never owned this fund. i have mentioned it and apparently some readers own it.
look at the top ten on Yahoo! Finance.
many of them were down a lot today and have not had a great month. the S&P was up a ton but many of the things Heebner is focused on all overlap and had a bad day.
Roger,
I would agree that a lot of your readers have said in the past they own it and obviously it was up big until the last few weeks. Overall, what is your opinion now of the fund? In most circles Heebner is seen as a genius, is he still one with his fund down 20% from it's highs of a few months ago??
YTD; ahead by a good bit
2007; beat the SPX by a mile
2006; about even
2005; beat by a mile
2004; about even
2003; beat by a mile
2002; beat by a little
2001; beat by a mile
2000; beat by a mile
1999; lagged by a good bit
1998; lagged by a mile
as far back as Yahoo goes teh fund is up almost 400% while SPX is up about 35%.
I have no idea if he is a genius or not but do you really think something has changed after a bad whatever time period you are looking at?
Anon: at 4:17 -
This is a "focus fund" with heavy concentrations. Right now he is loaded with energy & mining names(and has been for years) and the entire years' gains have been given back as rotation seems to be underway into financials from energy.
1} Is Larry and Roger related?
2} Larry is correct it does appear Heebner has lost all his 2008 profits in 2 weeks.
3} Do either of you think he will regroup and go in other areas or will he just stay in energy, steel, mining, etc??
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