Hey everyone,
I’m primarily a concentrated value investor—I follow the Graham/Buffett/Lynch school and I rarely hold more than 5 to 10 positions at a time. Because my portfolio is so focused, I know that my biggest risk isn’t market volatility, witch is is but i hold for 3+ years minimum; it’s my own psychology and "falling in love" with a ticker.
Lately, I’ve been reflecting on my actual "buying process" and I’m starting to wonder if I’m as disciplined as I think I am. I’ll spend weeks reading 10-Ks and listening to calls, but when it comes to the moment I actually hit "Buy," I realized I often don't have a structured, "hard" thesis to look back on. It’s more of an "informed gut feeling" after a lot of research.
I’m curious how those of you with concentrated portfolios actually operate:
1. **The Journaling Question:** Does the "Thesis" even matter to you? Do you find that writing it down actually changes your decision, or is it just extra work for a decision you’ve already made in your head?
2. **Strategy vs. Inspiration:** When you buy, do you use a formal checklist (like a Graham Margin of Safety check or Lynch’s "Story" framework), or is your process more fluid?
3. **The Audit:** For those who *do* write things down—do you ever go back and look at your notes a year later? If so, does it actually help you spot where your logic was flawed (e.g., misjudging a moat), or is the market usually just "too random" for that to be useful?
4. **The Bias Trap:** How do you keep yourself from "smoothing over" the red flags in your notes just because you want the stock to fit your value criteria?
I’m trying to decide if I should build a more rigorous system for myself to "force" that discipline, or if the best concentrated investors just "read, think, and buy."
What does your "Desk" actually look like when you're deciding on a 15% position?