Position sizing is important in long term invetsment, It should be large enough to impact your investments but small enough to keep your account intact in case of a catastrophe investment.
Zyne recommended position sizing sits at 20 to 25% per investment target.
At 20%-25% you will have around 5-6 positions at fully invested.
For $100,000 total investment capital the math works out like this:
$20,000 per investment target A
If the investment target A goes up 50% , the Return on Investment is $10,000
If the investment target A goes down 30% , the Loss on Investment is $6,000
Win: $100,000 + $10,000 = $110,000 (10% return on total capital)
Loss: $100,000 - $6,000 = $94,000 (6% loss on total capital)
Due to Zyne's adherance to investing in value, the loss should rarely be over 50% per target investment.
Risks of 20% position sizing = the returns won't be overwhelming but steady.
Rewards of 20% position sizing= Caps total investment target loss at 20% of capital, keeps you in the game.