Preparing Portfolios for 2017

Rob Lutts shares tips for managing stock portfolios

  1. Clear out the dead wood in the portfolio. We all have holdings that have not contributed and the fundamentals have weakened. Cut these holdings loose and add to your strongest ideas.
  2. Do a check up on the basis for your asset allocation decisions. How overweight are you in certain sectors? Is the case still strong for these over weights?
  3. Which holdings have the largest widest target market? Make sure you have enough of the holdings that can hit a grand slam home run.
  4. Do the facts support your bullish thesis on these sectors bets? Are you following the data carefully in these sectors to monitor progress in the investment cycle?
  5. Do you have a little bit of dry powder in case you find a really fantastic idea that needs to be acted on quickly? Having 3-5% cash is always a good idea.

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