Your Survival Guy’s been telling you for a while now how much overlap I’m seeing in mutual funds and ETF holdings. This has been good for performance, with the S&P 500 tech companies rowing the boat. But how long can that last?
My concern is the overall investor exposure to just one sector without them even knowing it. Instead of being crowded to one side and risking capsizing, why not build a portfolio that’s not so overweighted in one sector? Balanced funds are good, but even they are forced to buy the big tech companies because of the size of their assets under management. They basically have to buy them. Look at my table below and remember when the black swan swoops in, it matters how much you don’t lose.
Action Line: Unbalanced ships will capsize. When you’re ready to discuss balance in your portfolio, I’m here.
Originally posted on Your Survival Guy.
