How many investments do you need in a long term buy and hold portfolio?

Charlie Munger says you only need 2 or 3. The buy and hold the S&P strategy only holds one investment- the S&P. 85% of investors have not been able to beat this for 70 years. The average investor performance over that time is 5% per year less than the S&P.

The Stars buy and hold strategy holds two ETFs and earns twice the S&P. Stars is the best long term investment strategy I can find. When compared to the greatest investors of all time, it ranks number 18. The top 17 are no longer available for investment.

The typical investor may hold as many as 50 different investments. Every time one of these investments was picked there was only about a 30% odds that that investment would outperform the S&P over the next year. Also people tend to pick value stocks that have fallen in price. Value stocks underperform the S&P by 10% per year.

The typical portfolio holds 10% of investments that underperform the S&P by 30% per year. SPY and TQQQ are cap weighted. The average weighting of these contain the best 100 out of 6000 stocks. You hold the best 1.5% of all stocks by holding only SPY and TQQQ.

Not only is less holdings more performance, it is the best performance. With Stars you have the volatility and outperformance of TQQQ and the long term performance of SPY that is used to rebalance against.