The real risks behind concentrated portfolios

In the world of large US tech stocks, concentration has become a key issue for investors. The S&P 500’s concentration is on the rise, with both its top 10 holdings weight and industry concentration surging in recent years. Amid this intensity, Morningstar’s new multidimensional Concentration Score measures the boldness and diversification levels of portfolios, offering investors a more accurate picture of risk. Morningstar’s analysis shows that the S&P 500 Index remains more diversified than most US-focused funds and ETFs in Europe. Its assessment of its top 20 country indexes reveals that the...