--- title: "My Portfolio Wasn't as Diversified as I Thought: A Personal Lesson" author: Thomas Jeric published: 2026-11-09 updated: 2026-11-09 topic: Investing url: https://cowlpane.com/investing/my-portfolio-wasn-t-as-diversified-as-i-thought-a-personal-lesson/ --- # My Portfolio Wasn't as Diversified as I Thought: A Personal Lesson By Thomas Jeric · Nov 9, 2026 · Investing · cowlpane > **In 30 seconds:** I discovered that owning multiple ETFs didn't guarantee diversification in my portfolio. **My investing diary: I thought my portfolio was diversified. Then I checked.** **Category:** Investing ## By Thomas | financial enthusiast **In 30 seconds:** Owning several ETFs does not automatically mean diversification. I looked inside my portfolio and discovered that some of my biggest positions were hiding in plain sight. --- My investing diary: another lesson I probably should have learned earlier. A few evenings ago, I opened my brokerage account and started looking through my investments. Nothing unusual. A world ETF, some technology exposure, a few individual stocks. Pretty diversified, right? That was my assumption. Then I started checking which companies I actually owned through those ETFs. Damned. There were some familiar names appearing again and again. Microsoft. Apple. Nvidia. Alphabet. Different funds. Same companies. And suddenly my portfolio looked a lot less diversified than I thought. ## The ETF illusion I like ETFs. They are simple, relatively inexpensive, and they remove a lot of the pressure of choosing individual winners. My first ETF was deliberately boring. Buy the market, invest regularly, and stop trying to predict everything. That approach still makes sense to me. But somewhere along the way, I started adding things. A technology ETF because I work in IT and understand the industry. A Nasdaq-focused investment because I believed in long-term innovation. Some individual technology stocks because I liked their businesses. Each decision seemed reasonable on its own. Together, they created something different. I wasn’t necessarily buying more diversification. I was buying additional exposure to companies I already owned. ## What I found when I looked deeper A market-cap-weighted ETF gives larger companies more influence over its performance. That means a global equity ETF can already have significant exposure to the biggest American technology companies. Add a Nasdaq-100 ETF and the overlap can become substantial. Add individual shares of those same companies, and the concentration increases again. Imagine owning three funds that all hold Nvidia. If Nvidia falls sharply, all three positions can feel the impact. The funds have different names, but that doesn’t make their underlying risks independent. It reminds me of something from IT. Running three applications on the same server doesn’t give you three independent systems. If the server fails, everything goes down. Investments can work similarly. ## Diversification is about risk, not quantity This was probably the most useful realization. The number of positions in my portfolio tells me surprisingly little about how diversified it really is. What matters is what those positions depend on. Geography matters. Industries matter. Company size matters. Even currencies and interest-rate sensitivity can matter. And correlations matter. Two investments might look different on paper but react similarly when markets become nervous. Of course, diversification doesn’t eliminate losses. During a broad market sell-off, many assets can decline together. But understanding where my risks overlap helps me avoid taking the same bet repeatedly without noticing. ## What I changed in my thinking I didn’t immediately sell everything. That would have been another emotional decision disguised as portfolio management. Instead, I started asking three questions before considering another investment. First, what does this investment actually add? Second, am I increasing diversification or simply increasing an existing position? Third, would I still be comfortable holding this portfolio if my favorite sector had a terrible year? That last question is uncomfortable. Especially when you work in technology and genuinely believe in its future. But believing in an industry and allocating too much money to it are two different things. I can be optimistic about AI without making my entire financial future depend on AI stocks. ## My approach going forward For now, I still prefer a broad ETF as the foundation of my long-term portfolio. Individual stocks and sector ETFs can have a place, but I want to understand how much additional risk they introduce. I also want to review my actual holdings periodically, not just the names of the funds. A spreadsheet is enough to start. List the ETFs, check their largest holdings, and look for repeated companies and sectors. No complicated trading algorithm required. Funny, considering I enjoy building trading bots. Sometimes the most useful investment tool is simply understanding what you already own. And maybe that is the real lesson here. A portfolio doesn’t become diversified because it looks complicated. It becomes diversified when its risks are deliberately understood and managed. ## What about you? Have you ever checked how many times the same company appears across your ETFs and individual stocks? --- *This is my personal opinion, not investment advice. I am not a licensed financial adviser. All investments involve risk, including possible loss of capital. Do your own research.* --- Original: https://cowlpane.com/investing/my-portfolio-wasn-t-as-diversified-as-i-thought-a-personal-lesson/ Personal opinion of the author, not investment advice. When citing, please link the original.