Factor awareness
Market beta, sector factor, and idiosyncratic risk stack. In stress, correlations rise — your “spread out” book can move as one.
Index futures may already express the beta you think your stock picks diversify away.
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Five names in one sector can be one bet. Diversification is a risk map, not a ticker count.
Market beta, sector factor, and idiosyncratic risk stack. In stress, correlations rise — your “spread out” book can move as one.
Index futures may already express the beta you think your stock picks diversify away.