When someone wants to aim for a million in the stock market, what approach might they use? One tack would be to invest in dozens or even hundreds of different shares, hoping that one of them turns out to be the next Nvidia.

Nvidia has risen 894% in the past five years, so such an approach could seem like a promising way to aim for a million. However, I think there is a better way.

Sharp focus, not a broad brush

The problem is, it is easy now to say that Nvidia has done well. But there was no guarantee a few years back that would happen. Even some very promising businesses can turn into big disappointments for investors.

It is easy to see that after the event. However, as investors we are judging opportunities with subjective foresight, not objective hindsight.

Covering the waterfront by investing in dozens or even hundreds of shares may statistically improve the chance that one of them could turn out to be a star performer like Nvidia.

But it also increases the likelihood of having some real stinkers too. Additionally, it means that the amount invested in each share will be much smaller than if the same amount was invested in a far more concentrated portfolio. That will reduce the financial benefit of a star performer to the portfolio.

Going for the great performers

So then, what is the alternative? It is investing in just five to 10 different shares.

There is a theory to this: the top 50 FTSE 100 shares outperform the index. The top 20 outperform them. The top five to 10 outperform then. The same pattern holds for the FTSE 250.

That does not resolve the challenge of foresight I mentioned above. Nobody knows for sure what the best-performing five to 10 shares in the index in coming years will be.

But by focusing on hunting for just the very strongest investment ideas, I think someone can improve their chances as they aim for a million.

Of course, investing enough money over the long term also matters.

Another factor that can hurt performance is high dealing fees, commissions and charges eating into portfolio returns, so it makes sense to choose carefully when comparing share-dealing accounts, Stocks and Shares ISAs and trading apps.   

One share I’m eyeing

A recent fallback in price means Judges Scientific (LSE: JDG) is selling for 38% less than it was at the turn of the year. That means the company – with its track record of double digit percentage annual dividend growth – now yields 3.3%.

Having owned it before, I am tempted to invest again now. After all, the scientific instrument market has proven over time that its model of acquiring small and medium firms in niche areas can be highly cash generative, as clients are willing to pay for quality.

I think current challenges that explain the share price fall, like spending cuts in the US and shifting purchase patterns in China, could turn out to be temporary not permanent.

What if they are not though? That is a risk. So for now I am not buying. But I will follow Judges’ progress in coming months. If it can ride out current storms, I think it has excellent long-term growth potential.

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Christopher Ruane does not hold any positions in the companies mentioned.