Eggs, Baskets and Risk

This piece originally appeared on Real Money Pro.

The CNBC Million Dollar Portfolio challenge is now a week under way, so some traders can get their focus back on using actual dollars and away from Monopoly money. I find the whole challenge a bit laughable, because a prudent diversified approach to investing wouldn't work well, nor would tight stops or scaling trades lead you to victory. No, this is a contest where you have to put all your eggs in one basket. Even more, it is a long equity basket without options and above a stated market cap. In the end, it is 50% luck, 50% timing, and 10% skill. There is probably another 25% in there for luck as well. (The numbers make about as much sense as the challenge.)...521 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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