Why Warren Buffett's Right-Hand Man Said Diversification Will Not Work For Everyone
Key Takeaways
- In contrast to most financial advisors, Munger called wide diversification “protection against ignorance,” useful only when you don’t have conviction.
- Holding too many positions, he argued, can raise costs, blunt big winners, and still leave you exposed to market shocks.
- Munger advocated a balanced approach—owning a few great companies plus low-cost index funds—that can capture upside without unnecessary clutter.
The Burst
“I Will Be STUNNED If We Don’t Have A Recession”
Some financial commentators deserve your attention more than others. As CNBC and Bloomberg need to trot out wealth advisors and research analysts every hour to fill up air time, it’s hard to separate the wheat from the chaff. Stanley Druckenmiller is one of the rare voices worth listening to every time he speaks. And what he said is nothing short of frightening for the average investor.
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Market Commentary: Time To Buy This 9.12% Yield Stock?
It’s rare to find a stock offering a 9%+ yield that doesn’t have some murkiness under the hood, but is Medical Properties Trust (NYSE: MPW) that diamond in the rough?
We investigate whether this REIT that specializes in leasing healthcare facilities, a segment that has been traditionally regarded as recession-resistant, is worthy of a portfolio spot now.
» Read more about: Market Commentary: Time To Buy This 9.12% Yield Stock? »
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