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โ† Glossary ยท Risk and markets

Concentration risk

Too much money in one share, sector or region.

Concentration risk arises when a large part of your wealth depends on the same development, for example five shares from the same sector or a portfolio made up almost entirely of US tech stocks.

It often only shows when it is too late: several seemingly different positions fall at the same time because they share the same driver. Looking at the sectors in your portfolio helps spot such clusters.

Related terms

Not investment advice. Investing carries risk up to total loss.

Concentration risk โ€“ Glossary ยท DipCatcher