The strategy for building a strong stock portfolio is the same as playing at the best USA online casinos you need to establish objectives and stick to them. Given where they are at the stage of their lives will determine the amount of risk they are willing to take to generate a certain level of return. An individual approaching retirement will have more conservative stocks. These are shares of companies operating in stable businesses and are likely to pay out dividends. Income and capital preservation are their main goals.

A young investor is more pre-occupied with capital appreciation. They would be invested in the stocks of growth-orientated companies. Most investment experts recommend a stock portfolio should hold at least 15 stocks distributed over 5 industries in order to be properly diversified. The industries should each react differently to the economic cycle. Cyclical stocks are tied to the overall strength of the economy. These industries, such as natural resources and financials, do well when the economy does well. Growth stocks are those of companies that aggressively grow their top and bottom line regardless of the state of the economy.

Defensive stocks refer to industries where demand is steady regardless the state of the economy. They include power utilities, healthcare and consumer goods. Regardless of the industry it is in, the investor wants to acquire the stocks of companies that are likely to outperform their peers. The executives running these companies are focused on generating wealth for their shareholders. They are taking actions to keep their companies competitive and are growing profits. These stocks tend to have a habit of hitting new 52-week highs.