09-19-2015, 07:15 AM
I use a fixed dollar amount to define a full position, so that when a position is filled another stock will be bought to force diversification. When all stocks on my short list have been filled, I then can raise the dollar amount.
The actual full position amount will depend upon composition of the total portfolio. My portfolio has a large amount of mutual funds in my 401K and IRAs, while my wife's portfolio is primarily individual stocks from an inheritance. Both portfolios are roughly the same size. My full position amount is twice my wife's full position portfolio, since her portfolio has a greater need for diversification.
The actual full position amount will depend upon composition of the total portfolio. My portfolio has a large amount of mutual funds in my 401K and IRAs, while my wife's portfolio is primarily individual stocks from an inheritance. Both portfolios are roughly the same size. My full position amount is twice my wife's full position portfolio, since her portfolio has a greater need for diversification.