Comments on: Diversification In the Context of Number of Stocks http://www.dividendtree.net/commentary/diversification-in-the-context-of-number-of-stocks/ My journey of planting dividend investment seeds and watching it grow.... Tue, 16 Mar 2010 12:27:41 -0600 http://wordpress.org/?v=2.8.3 hourly 1 By: Lyle Allen http://www.dividendtree.net/commentary/diversification-in-the-context-of-number-of-stocks/comment-page-1/#comment-237 Lyle Allen Thu, 17 Sep 2009 23:22:38 +0000 http://www.dividendtree.net/?p=739#comment-237 Diversification is N-dimensional. Your examples shows that the S&P outperforms the DOW--but it is not so obvious from your time scheme. Do a chart of small, med & large cap stocks from 1900 to present. Without small caps you'd be horribly underserved--far and away dwarfing returns of the other caps. Another dimension might be growth-value (good luck on an operational definition to distingish these). Or, How about asset allocation over time--a higher level perspective on investing--that you began to address in another post. Best, lma Diversification is N-dimensional. Your examples shows that the S&P outperforms the DOW–but it is not so obvious from your time scheme. Do a chart of small, med & large cap stocks from 1900 to present. Without small caps you’d be horribly underserved–far and away dwarfing returns of the other caps. Another dimension might be growth-value (good luck on an operational definition to distingish these). Or, How about asset allocation over time–a higher level perspective on investing–that you began to address in another post.

Best,
lma

]]> By: Dividend Tree http://www.dividendtree.net/commentary/diversification-in-the-context-of-number-of-stocks/comment-page-1/#comment-166 Dividend Tree Mon, 06 Jul 2009 17:54:19 +0000 http://www.dividendtree.net/?p=739#comment-166 Daniel, That's a good observation. Perhaps, diversification is for income stream (and not capital appreciation?). Thanks for stopping by. Best Wishes, Daniel,

That’s a good observation. Perhaps, diversification is for income stream (and not capital appreciation?). Thanks for stopping by.

Best Wishes,

]]> By: Daniel M. Ryan http://www.dividendtree.net/commentary/diversification-in-the-context-of-number-of-stocks/comment-page-1/#comment-162 Daniel M. Ryan Sun, 05 Jul 2009 04:05:31 +0000 http://www.dividendtree.net/?p=739#comment-162 Regarding quality: I believe diversification originated as a way to minimize the blow of a stock or bond suspending or reducing payment. Ideally, nothing would happen to the [dividend/interest] income stream. If something went wrong, though, income was chopped but not by much. Regarding quality: I believe diversification originated as a way to minimize the blow of a stock or bond suspending or reducing payment. Ideally, nothing would happen to the [dividend/interest] income stream. If something went wrong, though, income was chopped but not by much.

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