I must admit here that Iam not a active investor myself and move out of a stock only when liquidity need arises and I am happy with 25 to 30% CAGR.
My defination of ACTIVE is people who are not satisfied with ten times in ten years kind of returns and those who are looking for 100X opportunity in ten years.For ex (2X-1.8X-1.7X-1.6X -1.5x-1.5x-1.5X-1.5x-1.5x-1.3x).And believe me some people do make it happen.I have seen this happening (unfortunately not with me).
OK let's see,some body sets his policy that he will make 100 X returns in ten years and be a active investor (as on now Indian laws do not provide capital punishment for this kind of crime.).For achieving this say he opts for five to six stock strategy.Now
we all know that over a longer time frame all above stocks (hawkins,gruh,poly,techno,indusind) can give 10x returns over ten years which comes to roughly 26% CAGR.Now all these stocks may not rise linearly and tandemly.Hence if one can rotate capital between these selected five buy playing period of undervaluation and overvaluation he can easily achieve above returns.
This clearly shows that buy quality stocks,rotate capital strictly between them and play undervaluation and overvaluation,reduce churning and slowly restore the first step as you near target can potentially generate much more returns than just by and hold.
You are already following this policy when you have dynamic % allocation additionally if Iam not wrong(from your previous posts) you go for leverages also (upto two years of annual income). This is a very advanced mode of investing and I am in a process of learning it.Hence even if you make only 5 to 10 trades a years since they are concentrated,synchronised and unidirectional they must have fetched you a great returns.
Please post information about your dynamic asset allocation strategy and intermitant leveraged top ups in detail so that we can learn something out of it.
Also the ten steps I have mentioned above may not be actually spread over 10 years they are just ten critical levels of trade and can actually be spread over five years also.
Let's try and do a brainstorming here regarding this