Motion Trader analyses practically every ASX stock (except LICs and ETFs). This means there will naturally be plenty of signals — the ASX has over 2,000 listings. No one buys all the signals (Jason included).
We generally suggest that a portfolio of around 20 to 40 stocks is suitable for the strategy. That said, there's nothing wrong with a larger portfolio. It all depends on what works best for you.
The purpose of the service is to identify stocks that meet the entry criteria and then bring them to your attention. You then choose which ones to buy when you have available capital.
It's interesting to note that a big managed fund typically won't invest in every possible opportunity. Many funds focus on the ASX 200 or 300 stocks, and leave out the other 1,700 or so. And the funds that focus on smaller stocks will often miss opportunities in larger stocks (and probably opportunities in many smaller stocks as well).
Remember, it's not about buying everything.
It's about buying a selection of stocks that have the potential to perform well.
Jason’s own portfolio is often full (i.e. his capital is fully invested). When this happens, he simply watches the new signals with interest. There will almost always be more opportunities than he’s able to follow.
And that's okay.
The aim isn't to be buying and selling all the time. Rather, it's to invest in a selection of stocks that meet the buying criteria and then let the market do its thing. When a stock reaches its exit point, it's simply a matter of rotating that capital into a new opportunity.
There are many ways of deciding which stocks to buy. Some people use fundamental analysis to zero in on the opportunities they like best. Others focus on a company's size or sector. While others simply take the first signal when they have available capital. There's no right or wrong. It all comes down to using an approach that's suitable to you.