Too Many Baskets

When you were a kid did your parents tell you, don’t put all your eggs in one basket. I am often asked to evaluate the investments in individual’s 401(k) accounts and what I’m seeing disturbs me. I see accounts with 20 or 30 mutual funds in them with net assets of less than $100,000. The average mutual fund has 350 stocks in it and when you do the math that means theses accounts own teeny tiny portions of 7,000 stocks. Currently there are only 7,200 stocks traded on the American exchanges. Th...