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.
