This article explains the result of not managing the asset allocation of an investment portfolio properly – concentration risk. It describes how this can occur and what to do to manage it, including seeking professional advice.
Concentration risk. No, it’s nothing to do with thinking too hard about something. In fact, it’s more likely to be a result of not paying enough attention.
Concentration risk is the increase in investment risk that comes about from not sufficiently diversifying your portfolio. In other words, too much money is concentrated in too few assets, sectors or geographical markets.
This can happen:
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