Question: follower and picks

**cheerful2** Wed Jun 01, 2005 12:50 pm

Question: follower and picks
Hi, Blast,

1. Could you please tell us how many subscribers do you have? I am trying to understand the impact of your pick.

2. Do you think 10 stock is good enough for diversification? When you replace a stock with a new pick, it can be either that the old pick is no longer good; or the new pick is just better. But for diversification, one may want to keep both in the latter case. Would you keep tracking the replaced one? If so, how many would you track?

Thanks!

**blast_investor** Wed Jun 01, 2005 2:32 pm

Hi cheerful,

(1) There are around 100 BIRTP subscribers at this moment.

(2) 10 stocks diversification issue:

There was prior academic research that 5 different stocks in different sector is diversified enough to preserve most of diversification benefit.

I believe 10 number is large enough for diversification of unexpected risk while 10 number is still small enough to have concentrated investment and to have thorough research on each stock.

(3) tracking of old picks

The old pick transaction is tracked in the history of model portfolio transaction. Both situation can happen for the reason behind the selling of the old pick: either no good/cheap, or still good, but there is better new pick. The trade alert issue will mention the reason for selling the old pick.

BIRTP newsletter report may still mention briefly the old pick afterwards, but in general, once the old pick was sold from the model portfolio, BIRTP newsletter will no longer cover that pick in its research.