My portfolio is almost entirely composed of exchange-traded funds (ETFs) . While my husband enjoys investing in shares of individual companies, I prefer to play it safe and buy funds that provide instant diversification without requiring me to spend a lot of time analyzing companies.
This means I'm limiting my potential returns, since index funds generally won't outperform the market while companies selected wisely can do so regularly. I'm OK with that since I'm also minimizing my risk and more importantly, since I know myself and am well aware that spending time researching earnings reports and evaluating stock fundamentals isn't my cup of tea.
That doesn't mean I never pick stocks, though. And on the rare occasions when I've done so, it's usually paid off. In fact, two of the three stocks I've purchased in my limited investing career provided more than a 100% return. They were Visa (NYSE: V) and Redfin (NASDAQ: RDFN) , both of which I purchased for the first time shortly after their initial public offerings (IPOs) and that I've increased my stake in over time. As of January 2021, I'm up on them 147% and 127%, respectively.
For further details see:
I Rarely Buy Stocks, but Here's How I Picked 2 That Doubled My Money