Abstract
A short analysis of how portfolio risk changes as holdings are added, and where the marginal benefit of further diversification begins to flatten. In the defined setup a previously reported difference of roughly 1.78 percentage points between 10-stock and 100-stock risk estimates is specific to the sample, market period, portfolio construction, and chosen risk measure, and is not presented as a universal figure.
How to read this
- The headline figure is tied to the defined setup (sample, period, construction, and risk measure) and should not be generalized beyond it.