Familiarity: portfolio’s silent risk, hidden concentration builds
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Investing in what you know feels sensible but familiarity has a way of quietly reshaping a portfolio over time, tilting allocations toward what has worked before and away from what might protect you next. The result is a kind of hidden concentration, where holdings that look diverse on paper share the same underlying vulnerabilities. Spotting it before it costs you real money is harder than most investors expect.
In this episode of Money Hacks, a podcast by The Business Times, Howie Lim is joined by Ritesh Ganeriwal, head of investment advisory at Syfe, and Daphne Tan, director of business development from CMC Markets, to work through how familiarity-driven risk builds and how to tell a temporary market rotation from a structural shift.
Why listen
- Why diversification across sectors is not the same as diversification across risk Two holdings in completely different industries can still fall together if they share the same economic driver.
- How to tell a short-term rotation from a fundamental shift Not all trends are equal and the difference matters for how long you hold.
- The three behavioural biases that concentrate risk without investors noticing Chasing winners, sticking to one geography, and buying only individual stocks are more common and more costly than they appear.
- Why the S&P 500 may not be as diversified as you think The top ten companies account for 40 per cent of its market cap. Ganeriwal explains what that means for drawdown risk and what to do about it.
In short, what our experts are saying is that familiarity is not a strategy. Listen now.
Money Hacks is the flagship personal finance podcast from The Business Times. Catch past episodes at bt.sg/podcasts. Have a burning question or episode idea? Email the team at btpodcasts@sph.com.sg.
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Written and hosted by: Howie Lim (howielim@sph.com.sg)
With Daphne Tan, director of business development, CMC Markets Singapore and Ritesh Ganeriwal, head of investment advisory, Syfe
Edited by: Howie Lim & Claressa Monteiro
Produced by: Howie Lim & Chai Pei Chieh
A podcast by BT Podcasts, The Business Times, SPH Media
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Do note: This podcast is meant to provide general information only. SPH Media accepts no liability for loss arising from any reliance on the podcast or use of third party’s products and services. Please consult professional advisors for independent advice.
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