Where the Pros Stash Their Own Dough, Part 6

Here's part 6 (the last part) of a piece from Money that reveals the secrets used by several investment pros when handling their own money:

Making only one bet Robert Zagunis of Jensen Investment Management has all his money in the Jensen Portfolio large-cap growth fund and in individual large-cap growth stocks. Ariel Capital Management's John Rogers (like Zagunis, a MONEY 50 fund manager) has 75 percent of his money in the small- and mid-cap value funds that Ariel runs.

"I kind of want people to know their portfolio manager is a true believer," says Rogers.

That shows admirable commitment, but it's too much risk for the average investor to take.

Most planners would tell you to have no more than 10 percent of your assets in company stock.

This is foolhardy to say the least. Some people hit it big by putting all their eggs in one basket, but the vast majority end up without any eggs or basket when it's all said and done. Don't risk your financial future by investing too much of your portfolio in one stock. The risk just isn't worth it.

Comments

[hedged]

technically only Mr. Ober is terrible undiversified by owning only 1 stock...the others have diversified portfolios, since they own mutual funds which own many securities. Of course, most small business-owners, as an example, have most or all of their wealth tied up in the private stock of their own company...which suggests that the "don't own only 1 stock" mantra is an oversimplification.