Why Diversification Results In Mediocrity
sari added
While there is unquestionably some truth to the idea that the world is often too random to literally make just one bet, the widely held assumption that diversification is a free lunch is just plain wrong. Just as there is benefit to be derived from diversification with respect to risk, there is a cost, too — that of losing whatever edge you might h... See more
Mike Speiser • Why Diversification Results In Mediocrity
sari added
Warren Buffet and many of the best investors I know favor making a few very well-informed bets rather than opting for significant diversification.
Mike Speiser • Why Diversification Results In Mediocrity
sari added
“Concentration produces wealth.
Diversification protects wealth.”
Diversification protects wealth.”
jamesclear.com • 3-2-1: On Correcting Mistakes, Youth, and Focus | James Clear
Isaac Feldman added
On the other hand, if you want to achieve superperformance, diversifying your portfolio too much is counterproductive.
Mark Minervini • Think & Trade Like a Champion: The Secrets, Rules & Blunt Truths of a Stock Market Wizard
Most investment managers are in a game where the clients expect them to know a lot about a lot of things. We didn't have any clients who could fire us at Berkshire Hathaway. So we didn't have to be governed by any such construct. And we came to this notion of finding a mispriced bet and loading up when we were very confident that&... See more
Charlie Munger • A Lesson On Elementary, Worldly Wisdom As It Relates To Investment Management & Business – Charles Munger, USC Business School, 1994
Daniel Bakalarz added
As Charlie Munger says, “The goal of investment is to find situations where it is safe not to diversify.”
Gautam Baid • The Joys of Compounding: The Passionate Pursuit of Lifelong Learning, Revised and Updated (Heilbrunn Center for Graham & Dodd Investing Series)
“The paradox of risk:
(1) Don't put all your eggs in one basket. If you lose the basket, you lose it all.
(2) Don't put your eggs in too many baskets. The more baskets you manage, the less energy you can put into each one. It's risky to do things halfway.
Diversified, but focused.”
(1) Don't put all your eggs in one basket. If you lose the basket, you lose it all.
(2) Don't put your eggs in too many baskets. The more baskets you manage, the less energy you can put into each one. It's risky to do things halfway.
Diversified, but focused.”
James Clear • 3-2-1: The paradox of risk, choosing the future, and treating the Earth well
Isaac Feldman added