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A handful of winners

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By Michael O’Connor, theislandinvestor.com

There seems to be a narrative in the market suggesting that stocks typically go up over time, and therefore, with a little homework 'my stock picks' will go up even more - but it isn't that simple.

This isn't a 50/50-coin toss.

The concentration of winners is more severe than you think.

The Russell 3000 Index has returned an average annualised return of 13% since 1980, but the disparity of returns that generate these profits is rarely focused on.

The vast majority of the positive returns over time can be attributed to just 7% of stocks - the 'mega winners'.

In a similar report studying the historical performance of the S&P 500, only 22% of the stocks in the S&P 500 outperformed the index from 2000 to 2020. Over that measurement period, the S&P 500 gained 322%, while the median stock rose by just 63%.

Put simply, the probability of picking a winner is lower than you think, but all is not lost. A couple of big winners are all you need.

A few good decisions

Warren Buffett - arguably the most successful investor in history, recently attributed his success to just 'a dozen truly good decisions'.

"Over the years, I have made many mistakes - our satisfactory results have been the product of about a dozen truly good decisions — that would be about one every five years. "

That's right, the best investor in history made one good decision every five years.

So how can someone who claims this be heralded as an investment guru?

Asymmetry

A stock can only drop by 100%, but there's no technical limit to how high a stock can go, so when you invest in some truly great companies, the handful of winners can more than offset the graveyard of losses you accumulate along the way.

Let's take one of Buffet's most notorious investments as an example;

Over a period of seven years ending in 1994, Buffett accumulated 400 million shares of Coca-Cola at a total cost of $1.3 billion. As of the end of 2022, that position was worth $25 billion. And let's not forget the $704 million in annual dividends.

For me, stocks like TTD and Nvidia have more than offset some very questionable investment decisions. (24-year-old me has a lot to answer for, but you live and learn, I guess).

Obviously, the goal is only to pick winners, but on the off-chance you can't perfectly predict the future, here's a good place to start:

1. Stop trying to jump on every opportunity. Focus on making a few good decisions and give them time to work in your favour.

2. Don't be fooled into thinking every investment will be a winner. You won't stick it out very long if you expect to be in the green 24/7. There will be guaranteed losses along the way, but over time, a handful of big winners is all you need.

To get my latest stock picks, sign up to my newsletter by scanning the QR code or go to www.theislandinvestor.com.

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Gary Moynihan wins racecourse style title

Style reigned supreme at Killarney Racecourse as local resident Gary Moynihan and Offaly’s Sylwia Novak captured the top honours at the Canella Lane Best Dressed Day. Moynihan, a local neuromuscular […]

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Style reigned supreme at Killarney Racecourse as local resident Gary Moynihan and Offaly’s Sylwia Novak captured the top honours at the Canella Lane Best Dressed Day.

Moynihan, a local neuromuscular therapist, claimed Best Dressed Gentleman in a made-to-measure six-button burgundy double-breasted suit with a navy check from Saville Menswear in Cork. He completed the winning look with a shirt and paisley tie from Simply Suits Killarney and brown derby shoes from Pavers at the Killarney Outlet Centre.
Best Dressed Lady was awarded to Novak, a hospital personal assistant from Tullamore, who wore a red polka-dot ensemble and custom hat designed by milliner Rita Daly, featuring sustainable jewellery made from recycled plastic.
Canella Lane owner Ciana Aspell praised the high standard of fashion on the day, while Killarney Racecourse Manager Karl McCay thanked the sponsors and racegoers for their support.
With the summer season now wrapped up, the team at Killarney Racecourse is gearing up for the October Festival on October 4 and 5, featuring its first-ever Student Raceday with SPIN South West on the Monday. Early ticket booking is advised.

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Gleneagle Concert Band opens recruitment drive for new members

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The Gleneagle Concert Band is inviting new members of all ages to join the ensemble as it prepares for its new season starting this September.



Open to children, young people, and adults from Killarney and surrounding areas, the band offers specialist instrumental tuition starting from age nine. Beginners can take lessons in clarinet, flute, saxophone, trumpet, trombone, French horn, euphonium, tuba, percussion, and drums before progressing into the main band.

No previous experience is required for adults or children. The band also welcomes adults who already play an instrument or wish to return to music after a break.

“What makes Gleneagle special is that our musicians don’t just rehearse in a room and play the occasional concert,” said Music Development Officer Vincent Condon. “They perform at major events, festivals and community occasions, take part in film productions, travel internationally and, importantly, have fun together as a band. The band is open to everyone. We welcome young people who want to learn an instrument, as well as adults who have previous musical experience and would like to return to playing.”

For information on registration and lessons, contact 087 222 9513 or visit the band’s social media pages.

Busy summer of events


The Gleneagle Concert Band has concluded a busy 12 months featuring public performances, festival appearances, and charity work.

Highlights included the annual summer street concerts in Killarney town, along with performances at Puck Fair, the Rose of Tralee, and the Summer in Killarney Festival. Band members were also involved in the filming of Jimmy, an upcoming Hollywood biographical drama based on actor Jimmy Stewart.

Community fundraising remained a focus over the past year, with the band supporting local causes including the Kerry Stars Special Olympics Sports Club and Recovery Haven Kerry Cancer Support House alongside a sold-out Annual Concert.

Following a tour to Seville in 2025, the band has confirmed its next overseas trip to Bilbao and San Sebastián in northern Spain, scheduled for August 2027.

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