In the Wiley study text, it is said that “Breadth is the number of independent active decisions made by the investor every year in constructing his portfolio”.
My question is… Are active decisions EVER independent?
I mean, if you have a value oriented strategy, the very fact that a stock advanced last year might make you underweight it this year.
And if you have a growth oriented strategy, the very fact that a stock advanced last year will make you overweight it this year.
Is there ever such a thing as ‘Independent active decisions from one period to the next’ ?