What Are The Dangers Of Over Diversifying Your Portfolio?
What Are The Dangers Of Over Diversifying Your Portfolio? Financial-industry experts also agree that over-diversification—buying more and more mutual funds, index funds, or exchange-traded funds—can amplify risk, stunt returns, and increase transaction costs and taxes. What’s the downside of diversified portfolio? Disadvantages of Increasing Diversification Diversifying an investment portfolio tends to limit potential gains and