Concentrated stock

Concentrated stock is an equity making up a substantial part (usually, more than 30%) of the investor's portfolio. The major risk associated with such a portfolio is a lack of diversification; concentrated stock makes a large portion of the investor's wealth dependent on the performance of one particular stock. The reasons for keeping a concentrated stock may be restrictions for sale (see restricted stock), emotional attachment, donation, inheritance, stock options, and the selling of businesses.

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