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onlineerica onlineerica
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2 months ago
Zachary holds 15 stocks in his portfolio.  The portfolio's return last year was 11%, but one stock, RJH, doubled in value.  What should Zachary do if he wants to be as diversified as he was at the beginning of the year?

▸ Sell some of the RJH because it now constitutes a higher percentage of his holdings.

▸ Sell the worst performing stock and use the proceeds to buy more RJH.

▸ Wait for the price for RJH and the remaining stocks to rise so the proportions are reestablished.

▸ Sell the RJH and buy a cheaper stock in the same industry.
Textbook 

Fundamentals of Investing


Edition: 14th
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micp3537micp3537
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2 months ago
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Sell some of the RJH because it now constitutes a higher percentage of his holdings.

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