A farm growing several crops is less dependent on one harvest, though a drought can still hurt them all.
01
Go deeper
Different assets may respond differently to events. Holding many funds does not automatically diversify a portfolio if they own similar investments. Diversification cannot eliminate losses in a broad market decline.
02
Make it concrete
Hypothetical illustration. Hypothetically, two funds both invest mainly in the same large technology companies. Two fund names do not mean two independent exposures.
03
When you read a headline
Check what is owned and how investments overlap; the count of holdings alone is insufficient.