Concentration Risk


The old saying goes: “There is no such thing as a free lunch.”

Actually there is at least one. In the investing world, one free lunch is diversification. You can’t control where the market moves tomorrow or even the next day. But you can control your diversification across investments. Diversification is one of the best risk mitigation strategies available to investors.

The examples of Enron, WorldCom, Bear Stearns, and Lehman Brothers resonate with most of us. In each of these cases, investors with a large portfolio position in one of these securities likely had their financial game plans wiped out by their rapid demise. And in each case, very few saw it coming before it was too late.

Perspective Wealth Partners carefully works to identify the risk points in your portfolio and then develops a plan to eliminate those risks. We believe managing your risk is equally important to managing your return.