Diversification limits needed with sound decisions from "summary" of Essays of Warren Buffett by Lawrence A. Cunningham
Warren Buffett believes that diversification is a "protection against ignorance," but it is not necessary if an investor is capable of making sound decisions. He argues that it is better to focus on a few investments that one understands well rather than spreading oneself too thin across a wide range of assets. Buffett's strategy is to invest in businesses that he believes will perform well over the long term, rather than trying to predict short-term market movements. He emphasizes the importance of doing thorough research and analysis before making an investment, so that one can be confident in the de...
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