4 weeks What criteria do you use to justify buying a stock vs. Just owning VTI or VOO? Reddit     

Mine is usually the obvious in that I think the stock will outperform the index over either a short or long time frame.

But I’m wondering if some would also buy certain stocks as a larger holding as a defensive measure against downside loss on a certain percentage of your portfolio versus cash/bonds.

For example I can think of JNJ of course. It’s largest drawdown was around -34% if I remember correctly and it’s worst year was -10%. It’s averaged a 14% return since the 80s.

So I could see it or even MSFT etc as ‘protecting’ a certain percentage of my portfolio in the long term whilst also offering better than a 10% return hopefully.

I don’t see JNJ or MSFT crashing and never recovering, but of course one can never say never.

But in general I’m just wondering what criteria you use for deciding id like to own this stock versus just putting the money in VOO.

submitted by /u/apooroldinvestor
[link] [comments]

· ·

What is Market Insider?

Market Insider is a business news aggregator for traders and investors that proposes to you the latest financial markets news, top stories headlines and trading analysis on stock market, currencies (Forex), cryptocurrency, commodities futures, ETFs & funds, bonds & rates and much more. We do not create or publish our own content or copy full articles from other sites. Market Insider works with public RSS feeds of best business news websites, personal blogs and provides automatically generated list of financial news links directly referring to its sources.