Diversification good or bad?

Do you consider yourself diversified?

 

Yes

 

Today an example, ASX smacked hard but I'm only feeling a small bump down.
Less 0.5% drawdown. (< Half a percent atm).

 

Would other people consider you diversified?

 

Pass.
Prolly not, as I'm long stocks only, but can short via ETF's.

 

Diversification is imperative. Can’t afford to lose everything in one go.

 

How much can you afford to lose in one go?

What do you consider overdiversified?

 

While diversification can help you spread risks, I think that you cannot overdo it either as then you will fail to concentrate properly.

 

In a bear market almost all stocks fall, but some go to ZERO.
And that's not even considering the possibility that the company you're invested in might be the next Wirecard or Crazy Eddie. You don't necessarily have to wait for a bear market to lose everything if you're in a single stock.

I limit the size of the investment I make in any one stock or etf.
It pretty much guarantees that my account won't increase 1000% in a year, but it also protects it from going to zero.

 

What is your limit?
Do you rebalance when the limit is exceeded?