LESSON 8.2 · CORE

Thirty holdings can still be one bet

Counting holdings measures the wrong thing.

BUILDING A PORTFOLIO3 MIN READ

Your holding count is the easiest number to know and one of the least useful. Thirty banks, or thirty companies that all depend on the oil price, tend to rise and fall together, so on a bad day they behave like one large holding. How closely things move together is their correlation.

What matters is effective diversification: roughly, how many independent bets you really hold. A handful of businesses that make money in different ways can spread risk further than dozens that share one driver. The app doesn't calculate correlation, but the sector split on your dashboard is a first rough look at whether your holdings share a driver.

30 holdingsOne shared driverCloser to one bet than thirty

The count went up. The number of separate bets didn't.

See your sector split →

Educational content only. It is not personal financial advice.