Many investors and finance professor believes and preach not to put all your investments in one basket. But we have a different opinion on it similar to another great value investor and Hedge fund manager Glen Greenberg.

The best description we have found for Glen Greenberg is given in the Pudd’nhead Wilson’s quotes by Mark Twain in regards to his name:

Behold, the fool saith, “Put not all thine eggs in the one basket” – which is but a manner of saying, “Scatter your money and your attention”; but the wise man saith, “Put all your eggs in the one basket and – watch that basket!”

The simple rule of investing is that share prices of any business will follow looking at businesses profitability over a long term. Same thing in Warren Buffett words, “Put together a portfolio of companies whose aggregate earnings march upward over the years, and so also will the portfolio’s market value”.

So, what we did first is calculated total profits made by the Nifty 50 companies in 2013, and we found that those companies by aggregate made profits of Rs 263,657 crore. In 2014 those same businesses made profits of Rs 304,173 crore which represents a growth of 15% in its earnings. We are expecting 2015 earnings will miss that same level of growth by little.

We picked up randomly 49 businesses from our watchlist which also includes all the businesses we hold in our portfolio and calculated what consensus are expecting the profits will grow in the year 2015 and 2016. We found that those businesses earnings will grow by 12% in the 2015 year and 22% for the year 2016.

Our portfolio earnings are expected to grow by 20% in aggregate for the year 2015 and 17% for the year 2016. We are not worried about our holding earnings not matching up with overall markets expectation for the year 2016 as we still hold a good proportion of our funds in cash and are ready for any opportunity thrown by market to us.

Check your portfolios aggregate profits, if they are not growing above or at par to market expectations than it might be a time to recheck your basket of holdings and do some changes. As we think that this is the good time to do.

Happy Investing!!