While many investors and financial advisors may be worried that the idea of a “diversified portfolio” may be somewhat of an illusion these days, I don’t think it is necessarily a bad thing. After all Warren Buffett himself once said that, "Diversification is protection against ignorance. It makes little sense if you know what you are doing."
In other words many investors become so diversified that the ruin any chance of achieving alpha (or outperformance) on their portfolios. That’s one reason why most financial advisors cant manage to match the broad stock indexes.
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