Put Steel Stocks in Your Basket

My investment philosophy is deeply rooted in the teachings of the late Ben Graham and those who practice his approach, such as Mason Hawkins, Seth Klarman, Warren Buffett. They have proven that buying pieces of a business after rigorous evaluation and only at a margin of safety works well in any environment over a period of years. Therefore, I generally favor concentration over diversification, securities that aren't overly popular at the time, less debt to more debt and exceptional management whenever possible.

However, there are instances when entire industries or markets are so profoundly mispriced, it becomes difficult to truly handicap the ultimate winners. But the opportunity looks so compelling from a valuation and risk/reward perspective. In those instances, I'm a big fan of creating a basket of stocks from that industry or market -- make one of your portfolio holdings a basket of various holdings. In a sense, you are creating your own ETF....380 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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