Stock Market Diversification

In one of my previous articles (Investing in the stock market -9 powerful tips), tip number one was:

1. Do not spread your money too thin.

My friend has a little over $200,000 invested in the stock market through 27 different Mutual funds. In my opinion, 27 Mutual funds is 27 too many collecting load fees, management fees, commission fees, operating and advertising fees. Diversity is important, but just as important is over-diversification. Also, in my opinion, $200,000 should not be put into more than 12 stocks, let alone 27 different Mutual funds.

If I may, I would like to explain where I'm coming from by stating that tip.

On October 16, 1990 the Royal Swedish Academy of Sciences awarded 3 men each a third of the Nobel Peace Prize for their work in the theory of financial economics ? Harry Markowitz, Merton Miller and William Sharpe.

Harry Markowitz's work involved the theory of portfolio choice. (This in layman's terms was the introduction of a diversified portfolio to help offset the uncertainty and risk of investing in the stock market. Harry Markowitz has been labeled the 'Father of Diversification'.

William Sharpe used Markowitz's model from an individual investment theory to a market analysis theory based on price formation for financial assets. This formulation is called Capital Asset Pricing Model (CAPM). From what I understand about this model is that it places a "beta value" on a share, the higher the beta value, the higher the risk. By knowing the 'beta value' of each stock in a portfolio, the portfolio can be adjusted to either involve more or less risk.

Merton Miller's work involved dividends supplied by companies to a shareholder and its effect on stock market value and the effects of taxes. Miller's theorems are used for theoretical and empirical analysis in corporate finance.

Markowitz received his award for an essay published in 1952, "Portfolio Selection" and for his book in 1959, Portfolio Selection: Efficient Diversification.

Harry Markowitz, in his Nobel lecture given in 1990 says: "an investor who knew the future returns of a security with certainty would invest in only one security, namely the one with the highest future return'.

Nowhere could I find that an investor should own 27 different mutual funds.

For more excerpts from the book 'The Stockopoly Plan' please visit http://www.thestockopolyplan.com

Charles M. O'Melia is an individual investor with almost 40 years of experience and passion for the stock market. The author of the book 'The Stockopoly Plan ? Investing for Retirement'; published by American-Book Publishing. To order a copy of the book: http://www.thestockopolyplan.com

recurring maid service Glenview ...

In The News:

MacSync malware hides malicious commands inside iCloud calendar events to download additional payloads onto infected Macs without raising suspicion.

Joseph Holycross dismissed his racing heart for nearly two years until his Samsung Galaxy Watch detected atrial fibrillation and changed everything.

Home title fraud begins when criminals forge your signature on a deed. Here is how to check your own property records and set up free alerts.

Jeffrey Ladish, a former Anthropic security team member, warns AI agents are colluding and hacking with no reliable solution to keep them in check.

Instinct Concierge and Meta Muse can now place phone calls to businesses on your behalf, but the privacy and data access tradeoffs are significant.

Olivia Moore spent $100 to create a fake RushTok influencer using ChatGPT and MiniMax, and thousands of Bama Rush fans couldn't tell the difference.

RatHat Android malware uses AI to steal banking credentials, intercept two-factor authentication codes and reconstruct your PIN from touch inputs.

The Fox News AI Newsletter covers the latest artificial intelligence technology advancements, including the challenges and opportunities AI presents now and for the future.

Apple and Google password managers can flag compromised, weak and reused passwords on your phone before credential stuffing attacks can strike.

Researcher Peter Garrigan says Moonshot AI's Kimi model was manipulated into providing instructions for biological weapons and assassination plans.

iPhone, Google Pixel and Samsung Galaxy phones now offer call screening that asks unknown callers to identify themselves before your phone rings.

Ransomware can lock your irreplaceable photos and documents in seconds. A tested backup strategy and stronger cybersecurity habits are your best defense.

ShinyHunters claims it breached FBIJobs.gov and stole Social Security numbers, home addresses and sensitive assignment details of FBI personnel.

Find My iPhone, Google Find Hub and Samsung Find have critical tracking settings to enable now, before your phone ever goes missing or stolen.

The FTC proposed a new enforcement policy on personalized pricing, warning companies that hide how personal data shapes the prices shoppers see.

The $250 million Apple Siri AI settlement is now accepting claims, with eligible iPhone owners potentially receiving up to $95 per device.

ShareAScan turns T-shirts into scannable digital business cards with QR codes that link to profiles the owner can update anytime they choose.

BragJack research reveals how a single malicious browser extension could hijack Gemini, Perplexity Comet and Edge AI agents with zero clicks.

A phishing campaign impersonating OpenAI uses fake ChatGPT billing emails with a convincing login page to steal credentials and payment details.

Startups are helping modernize America’s defense industry with new technology and innovative ideas as the War Department diversifies its inventory.

New account fraud victims jumped 31% in 2025, reaching 5.4 million. Criminals open accounts you may never see on your regular bank statements.

Flytrex says its AI-powered Rooftop Dock system in Dallas-Fort Worth positions drones at restaurants before orders arrive, cutting delivery costs by 60%.

Samson Sky's Switchblade flying car secures $80 million from Dubai's Matin Group, but the redesigned hybrid-electric aircraft still needs more testing.

The Fox News AI Newsletter covers the latest artificial intelligence technology advancements, including the challenges and opportunities AI presents now and for the future.

CenterPoint Energy confirmed customer data was stolen, while a hacker claims 7.49 million records with partial Social Security numbers were taken.

Stock Market Diversification

Stocks & Mutual Fund