Diversification is important for a sound portfolio. However, many investors take this as having their fingers in every asset pie. Diversification isn’t just about holding multiple assets – it is ensuring you are holding the right assets to achieve your goals while managing your risk. Diversifying properly means that you are protecting yourself from risk. Risk in this case is permanently losing capital. In other words, one or more of your holdings loses all value and goes to $0.

Below, we’ve focused on our best resources to finding the right balance in your portfolio between over and under diversifying.

Why you should diversify and avoid these common mistakes, Investing Compass podcast.

This episode of Investing Compass takes a deep dive into diversification, and the perils of over and under diversifying your portfolio. Mark shares two of his mistakes he made with his portfolio, and the lessons that he learnt from his experiences.

Don’t confuse diversification with hedging, Mark LaMonica. Learn why hedging and diversification serve different purposes and how to avoid common pitfalls.

The underappreciated concentration risks of indices, Adrian Warner. Many investors assume index funds offer broad diversification, but are they as diverse as they seem?

Can you achieve global diversification with multinational companies?, Shani Jayamanne. A Morningstar report explores if the benefits of global investing can be achieved by investing in global companies trading on local exchanges.

Buffett’s Most Misunderstood Quote, Mark LaMonica. Warren Buffett famously said, “Diversification is protection against ignorance.” What did he really mean?

Building a diversified portfolio to align with your goals and values, Annika Bradley. Like many things in life, working out where you’re going, where you’re at, and the gap between the two is critical.

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