Uploaded February 2023 | Updated September 2026, 1 week ago
We’ll talk about diversification, Warren Buffett’s famous Berkshire Hathaway portfolio, as well as the academic study that thought it had this question answered only later to be challenged.
Some people only have a handful, some people use funds to hold hundreds and hundreds. In this video, we will weigh up the opportunity cost of diversification against the advantages of spreading your bets.
⌚ Timestamps:
0:00 - Intro
1:47 - The Birthday Paradox
4:19 - Downside to diversification
5:50 - Buying the haystack
6:53 - Allocate your capital according to your conviction
🍿 Enjoyed the video? There’s more:
1. youtube.com/watch?v=iXy66NNHpQM&t
2. youtube.com/watch?v=YLNc1fyjZ2E&t
3. youtube.com/watch?v=aKREyFrvzeQ&t
📲 Trading 212 on Social Media:
• twitter.com/Trading212
• facebook.com/Trading212
• instagram.com/trading212
Visit us at trading212.com
Download our free mobile apps for iOS or Android: trading212.com/GetTheApp
Some interesting links and further reading on the topic:
- ‘Some Studies of Variability of Returns on Investments in Common Stocks’ by Lawrence Fisher and James Lorie - jstor.org/stable/2352105
- ‘The Illusion of Diversification: The Myth of the 30 Stock Portfolio’ - investopedia.com/articles/stocks/11/illusion-of-diversification.asp
Our Investing 101 series covers the fundamentals of investing and tries to bring you the basics to build a solid foundation. Let us know in the comments about future topics you would like to see covered in these videos.
Tom's personal YouTube channel: @ThatFinanceShow
#stocks #investing #investing101 #trading212 #trading #equities
When investing, your capital is at risk. Investments can fall and rise and you may get back less than you invested.
We’ll talk about diversification, Warren Buffett’s famous Berkshire Hathaway portfolio, as well as the academic study that thought it had this question answered only later to be challenged.
Some people only have a handful, some people use funds to hold hundreds and hundreds. In this video, we will weigh up the opportunity cost of diversification against the advantages of spreading your bets.
⌚ Timestamps:
0:00 - Intro
1:47 - The Birthday Paradox
4:19 - Downside to diversification
5:50 - Buying the haystack
6:53 - Allocate your capital according to your conviction
🍿 Enjoyed the video? There’s more:
1. youtube.com/watch?v=iXy66NNHpQM&t
2. youtube.com/watch?v=YLNc1fyjZ2E&t
3. youtube.com/watch?v=aKREyFrvzeQ&t
📲 Trading 212 on Social Media:
• twitter.com/Trading212
• facebook.com/Trading212
• instagram.com/trading212
Visit us at trading212.com
Download our free mobile apps for iOS or Android: trading212.com/GetTheApp
Some interesting links and further reading on the topic:
- ‘Some Studies of Variability of Returns on Investments in Common Stocks’ by Lawrence Fisher and James Lorie - jstor.org/stable/2352105
- ‘The Illusion of Diversification: The Myth of the 30 Stock Portfolio’ - investopedia.com/articles/stocks/11/illusion-of-diversification.asp
Our Investing 101 series covers the fundamentals of investing and tries to bring you the basics to build a solid foundation. Let us know in the comments about future topics you would like to see covered in these videos.
Tom's personal YouTube channel: @ThatFinanceShow
#stocks #investing #investing101 #trading212 #trading #equities
When investing, your capital is at risk. Investments can fall and rise and you may get back less than you invested.
