Why concentration is the biggest risk to your portfolio
Concentration has been quietly increasing in most equity benchmarks and is challenging diversification benefits, with exposure to Russia the most recent to bite.
When Russia invaded Ukraine in February and attracted global condemnation and unprecedented financial market sanctions, many investors were surprised to learn the extent of Russian exposure in their portfolios via global products.
Russia represented some 3.2 per cent of the MSCI emerging market equity benchmark and around 1 per cent of the emerging market debt benchmark.
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James Wright is a founding partner of Sayers, a modern advisory and investment business.
