The real question behind this question is how diversified do I need to be before I reach the level of marginal benefits?
The goal of the ultimate portfolio is to reduce risk as much as possible and maximize return as much as possible. To do this we need to balance diversification with correlation.
At what point does adding an additional non-correlated asset to a portfolio no longer provide us with a decrease in risk? Whether the asset has a 60% correlation or a 0% correlation, the calculations show us that adding up to 5 assets can significantly decrease your risk, and after 15-20 assets, the risk reduction is nominal, meaning that the probability of losing money in a given year hardly decreases and therefore no value is added.
The power of diversification is that if you cut your risk in half, you have doubled your return relative to your risk. This usually happens around 7-8 assets depending on the correlations.
For example, over 80% of Warren Buffett's portfolio is in 7 stocks.
We can then conclude that depending on your risk tolerance, 5-20 assets is all you need to fully maximize the benefits of diversification. And from a return perspective, we must remember that for every dollar you are investing into asset #25, that is a dollar that you are not investing into asset #1.
There is less risk in owning 3 wonderful businesses than there is in owning 100 average businesses over time. - Warren Buffett
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