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| Author: | Statman, M. |
| Title: | How many stocks make a diversified portfolio? |
| Journal: | Journal of Financial and Quantitative Analysis
1987 : SEP, VOL. 22:3, p. 353-363 |
| Index terms: | PORTFOLIO MANAGEMENT DIVERSIFICATION |
| Language: | eng |
| Abstract: | It is shown that a well-diversified portfolio of randomly chosen stocks contains at least 30 stocks for a borrowing investor and 40 stocks for a lending investor. Our results contradict the widely accepted notion that 10 stocks are sufficient for exhausting the advantages of diversification. Further, the actual levels of diversification found in individuals' portfolios are also evaluated. |
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