Football Team of Stocks: 3 Lessons from My Best (and Worst?) Players Over the Years

It has been an emotional fortnight for the Liverpool fan in me.

I’m not talking about the lacklustre performance this season, but rather the departures of Mo Salah and Andy Robertson. Their exits truly bring an end to an incredible decade of relentless energy and passion on the pitch.

It’s not all “sadness” though; it’s a deep sense of appreciation and gratitude for having witnessed this era.

Watching recent and past interviews and highlights, I am reminded of how these individuals arrived as strangers, became colleagues, bonded as friends, and ultimately worked seamlessly as a team to strike fear into their opponents.

Before I lose the non-football fans and rival team readers, let me assure you: this post isn’t just about football.

It is the evolution of an idea I wrote back in 2018 (read here and here), where I drew the parallel that managing an investing portfolio is similar to managing a football team.

Looking back at the raw data of my portfolio’s top and bottom five holdings over the last seven years, it’s clear that what started as a fun analogy is completely transferrable to achieving great investment results.

Here are three lessons I glimpsed from the data.

Lesson 1: Let the Winners Compound

A stock can do well in a single year and provide you with a stellar annual return. But only a rare few can consistently repeat such performances over a long multi-year cycle.

Just like you wouldn’t sell Mo Salah when he kept scoring goals season after season, you shouldn’t let high-conviction compounders go too easily.

The ability to compound wins year after year signals a very powerful underlying growth engine.

Look at Arista Networks (ANET)—a ten-bagger with four Top 5 appearances, or iFAST (AIY) which also appeared four times in the Top 5 chart with a total return of over 300%!

In fact, if not for my periodically averaging up on iFAST over the years, its percentage return would be even higher. However, I don’t mind it as my absolute dollar returns are much larger because of it.

Of course, letting your winners run like this means they will eventually grow so large that they begin to dominate your portfolio.

When that happens, it is completely fine to take some money off the table to rebalance and de-risk. I do that myself, even though deep down I know my portfolio’s performance would likely be even better if I just did nothing at all!

Oh well—a good night’s sleep is more important than maximizing every single percentage point of return.

But unless there is a fundamental, structural deterioration in the underlying business model, divesting your top players completely will likely end up being a massive mistake.

Lesson 2: To Sell or Not To Sell?

This is by far the most interesting data I uncovered from this tracking exercise.

My top long-term performers, such as iFAST and Micro-Mechanics (5DD), don’t just sit comfortably in the top echelon forever. In fact, they routinely plummeted straight into the bottom tier of annual performance.

Even for a high-flyer like Arista Networks, while it didn’t land on the annual bottom list verbatim, I have watched it visit the cellar often enough over the years. It was sitting there right before the recent rally, and is now trying to break into the attic.

Just like a world-class manager doesn’t dump their star striker simply because they hit an abysmal patch of form, you shouldn’t abandon a structurally sound business just because it hits a temporary low stock price.

Volatility is the toll you pay for market-beating returns. To be clear, volatility here refers to the share price, not the business.

Short-term stock prices merely reflect fickle market sentiment, tossed around by a messy stew of geopolitical developments, missed analyst expectations, unrelated headlines, and pure herd mentality.

While some of these are potential headwinds to the business, most are simply noise. If you look under the hood of these specific companies, you’ll see that most continued to report robust, profitable results over these exact same years.

Sizing the Conviction

For businesses where you haven’t built up the necessary confidence, it’s always prudent to hold a smaller position.

It’s just like dealing with a promising academy player—you let him play some minutes for a few matches, but he won’t be in the starting eleven just yet.

AEM Holdings (AWX) is the perfect example.

Looking at the 478% return, you might think that I always possessed a rock-solid conviction in its business.

I certainly do now, especially after the CEO articulated the company’s five strategic growth pillars at the AGM with clarity. However, a few years ago when its share price plummeted due to its various operational challenges, I had my doubts.

While I saw its immense potential, I felt uncertain about its execution. So, I deliberately limited its position size to less than 2% of my portfolio.

Keeping the position size small significantly reduced my downside risk, giving me the emotional breathing room to hold on to what eventually turned out to be a massive winner.

Prune Ruthlessly

There are times, though, when you need to prune ruthlessly. When players consistently underperform, they need to be sold.

You can see from my chart that I did that quite often. I like to take up small tactical positions in stocks that display potential growth or a possible turnaround. But more often than not, it didn’t turn out well, and I had to exit.

On other occasions, a change in overarching tactics means a need to remove out-of-position players.

For example, when I wanted to free up cash for other market opportunities, I fully divested my three Mapletree REITs and consolidated most of my remaining REIT exposure into the Amova-STC Asia REIT ETF (SGX: CFA) utilising my CPF funds.

Ultimately, the decision to sell or hold boils down to the underlying business fundamentals. That itself is a pure judgment call based entirely on your personal understanding of your investment.

Lesson 3: Every Stock Has a Role

“But I would say Gini Wijnaldum and Millie [Milner] and Hendo [Henderson]. These guys just, without them, we wouldn’t have won anything.“
–Mohamed Salah

You don’t win a game with eleven attackers.

Similarly, I have structured my portfolio with dependable anchors like DBS (D05), OCBC (O39), and Parkway Life REIT (C2PU).

They rarely make the flashy, viral growth headlines, but their steady cash generation provides the structural defensive ballast that allows me to comfortably hold onto volatile growth engines.

It’s also interesting to see the likes of HRnetGroup (CHZ) and The Hour Glass (AGS) appearing in the Bottom 5 at some point, yet still producing a positive long-term return.

The fact that they have never appeared in the Top 5 list means they simply did their jobs quietly in the background, without causing a single shred of portfolio anxiety.

Presenting to You Team 2026

Looking back at this seven-year data set shows that long-term investing isn’t about finding a flawless portfolio where nothing ever drops into the bottom tier.

It is about constructing a simple, well-balanced formation where the defensive stocks churn out steady returns, allowing the growth stocks to provide the alpha, while compounding does the heavy lifting over time.

I leave you with my latest lineup.

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