Eric Siu breaks down whether diversification works, citing Mark Cuban and Warren Buffett. Buffett concentrated on just 8-10 investments early on, though Berkshire Hathaway holds more now. The real limit is how many companies you can actually manage.
So Mark Cuban, the billionaire, has said diversification is for idiots. And Warren Buffett has said, look, you know, instead of having multiple baskets, right, you should diversify into different baskets. Like, no, no, no, you should have one basket and look at it, just watch it like a hawk, right? And when you think about Warren Buffett, like back in the day, most people don't know this, but they only focused on having like 8 to 10 investments at any given time. Now Berkshire Hathaway is a lot bigger. They have to diversify even more and they have so much money to deploy, right? But the lesson here is that there's only so much you can do at once.
