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To Diversify or Not diversify, that is the question...
Old 11-14-2020, 09:31 PM   #1
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To Diversify or Not diversify, that is the question...

I diversify passively through retirement accounts-- 401ks and an IRA. I invest actively through my individual stock account and I diversify within in it very little. I find that this works for me. I'm not asking for anyone's advice here, (so many people seem to assume so much). The title of the post merely is intended to share how you choose to diversify or not in your world. I enjoy hearing how others handle their affairs.
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Old 11-14-2020, 09:49 PM   #2
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I hold wide diversified funds. My only deviation is some sector type funds that are a little more specific than the broad market type.
When working I did have company stock, however that was all swapped to the diversified funds once left company.
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Old 11-14-2020, 10:05 PM   #3
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I/we diversify per a 60/40 equity/debt-cash plan, with equities increasing slowly as we age. In our Roths, however, we are 100% equity.
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Old 11-15-2020, 02:41 AM   #4
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I Diversify, but YMMV.
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Old 11-15-2020, 03:28 AM   #5
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We hold broadly diversified mutual funds in all accounts. We have exposure to small and mid cap funds as well as international and large cap. We gave up specialty sectors like REITs not long ago. We hold around 50/50 stock funds and fixed income funds so we are diversified that way too. Fixed income is diversified across cash, short-term and intermediate duration funds. Broad diversification was always a goal since building the retirement portfolio. Before retiring we were highly concentrated in company stock.
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Old 11-15-2020, 04:00 AM   #6
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Here is Blue531 again. Starts a thread and doesn't post again on that thread. A few days later starts another thread and again doesn't post again on that thread. Very strange.
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Old 11-15-2020, 04:16 AM   #7
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I diversify passively in my tax advantaged retirement account, through board based index funds. I actively diversify in after tax accounts, mainly with individual stocks. But I am closer to a buy-and-forget investor than a trader. I may slowly convert my active positions into passive indexes over the next decade, but I enjoy having some active engagement.
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Old 11-15-2020, 06:58 AM   #8
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We have diversified by holding individual stocks, individual muni bonds, investment real estate and cash (CDs, money market etc...) in approximately equal proportions of 25%.

Because interest rates are so low, the muni bond portion of our portfolio has decreased (through calls or maturity) in the past few years and the funds have been transferred to individual stocks and real estate. The decrease in rates has made it impossible to replace the bonds at an acceptable interest rate but has resulted in an increase in the value of the real estate.
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Old 11-15-2020, 07:19 AM   #9
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Quote:
Originally Posted by Blue531 View Post
I diversify passively through retirement accounts-- 401ks and an IRA. I invest actively through my individual stock account and I diversify within in it very little. I find that this works for me. I'm not asking for anyone's advice here, (so many people seem to assume so much). The title of the post merely is intended to share how you choose to diversify or not in your world. I enjoy hearing how others handle their affairs.
Our approach is similar to yours.
1) Retirement accounts (85%) hold passive index funds only.
2) Taxable brokerage (15%) is amorphous group of stocks, ETFs and funds.
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Old 11-15-2020, 07:38 AM   #10
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I tried to do something similar, Blue531, at least I think my thinking and motivation was similar; our retirement accounts are a handful of mutual funds with a target AA where we set it and forget it, but then I inherited a small IRA and decided to buy some individual stocks in an industry that I tend to read a lot about (tech), and eventually cryptocurrencies. I call it the "fun money" approach, and the main benefit of this approach has been to remind me to stick to passive investing.

(My individual stocks that I've bought and held for over 10 years have done well, but everything else has been an object lesson. Even the stocks, I now wish I held in a taxable account instead of an inherited IRA, but I may fix that this year or next by simply "swapping" a couple of positions between accounts.)
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Old 11-15-2020, 07:47 AM   #11
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I lost around 1/3 of my net worth recently due to investing too much in a single stock. From now on the least diversified I will get is the S&P 500 index fund
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Old 11-15-2020, 08:39 AM   #12
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We are invested in equities, short term bond funds, cash, and real estate. The real estate is a nice diversification as it pays a quarterly cash dividend.
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Old 11-15-2020, 10:08 AM   #13
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Hey Blue531
How are you diversified on your side for comparison?
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Old 12-01-2020, 07:43 AM   #14
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To Dtail: Currently, 65% of my net worth is diversified in various index funds in 401ks and an IRA. 35% is in my stock portfolio which has only one stock in it.
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