I’ve only got so much cash available each month to invest and faced with so many shares, investment trusts and funds, it’s getting very hard to make a decision on which one(s) to invest in.
Actually, funds (or rather trackers) are a little easier as I invest in them every month since they form the bulk of my passive investment strategy and as I’m still aiming to get my allocations close to my Portfolio for All Seasons, I just buy whatever fund is needed to maintain the required allocations.
But shares and investment trusts – there are so many good ones to invest in, which one(s) should I invest in (first) with my hard-earned cash?
Ultimately, I hope to invest in all the companies on my short list (after researching and monitoring) – it’s just a matter of when to pull the trigger, which one to buy now. The short list changes from time to time as it gets reviewed, some companies drop out of it and others get added to it.
But even with the short list, the choice is still difficult – do I choose Share A over Share B and oh look, Share C is looking rather tasty, so maybe I should go for that one? Oh hang on a minute, Investment Trust D is looking pretty solid too, so why not invest there? But maybe I should just be look at good shares in industrial, telecoms or utilities sectors as I’m a bit light in those areas? How about topping up on a share I already own? Decisions, decisions…my head sometimes feels like it’s going to explode!
Obviously, my problem would be solved if only I could just earn lots more money so that I could invest in all of them at the same time but that’s easier said than done!
I had a bit of a conversation with Dividend Drive in the comments section of his post and I mentioned that I was getting a little stressed from obsessing about trying to get ‘optimum diversification’ for my share portfolio and stressing about which shares to buy. I mentioned that “the next one I go for will be decided on the roll of a dice or something like that.”
So for this month, to decide on what to invest in, I asked ‘Lady Luck’ to show me which investment to go for (from my short list) – by a roll of the dice.
Was I wrong to do this?
How do other investors choose, when after doing all your research, one investment looks just as good as another and you only have so much money to invest at that particular time?
Does a share just ‘jump out at you’ and you know it’s ‘the one’ to buy now?
Well, I’m not going to be doing this every time – maybe only when my head starts hurting!
And before anyone mentions it, if any share/investment trust that I’ve bought this way leads to an epic failure, I won’t be crying and saying “The dice made me do it!”
Anyway, doing this reminded me of a book/part-biography I once read, ‘The Dice Man‘ by Luke Rhinehart, (written in the 70’s) where a man uses dice to make (at times controversial, other times amusing) decisions in his life.
Good job I’m not being so radical!