Concentration Risk
What concentration risk means at both the single-name and factor level.
Plain-English definition
Concentration risk is the risk that too much of your result depends on one name, sector, theme, or factor.
Why it matters
It often explains why a portfolio feels diversified until one shared risk factor hits.
Beginner example
Holding many AI-related names can still be concentrated exposure if they respond to the same narrative and rates backdrop.
Common misunderstanding
Ticker count does not automatically eliminate concentration risk.
Practice with Alpha Council
Help me identify concentration risk in my portfolio.
Not Financial Advice
This learn page is for education and research workflow guidance only. It explains concepts, metrics, and analysis steps used inside Alpha Council. It does not provide personalized investment advice, guaranteed outcomes, or automated trading instructions.