Quote
"This [covariance] is something that is not in the habit of thinking of most amateur investors. They look at their investments one at a time, and they dont, you always have to go back and say, whats the covariance? Thats what really matters for what happen to your portfolio. Because when you invest in a lot of companies that are all the same, youre asking for trouble, because the whole thing is going to either blow up or succeed. And you cant live like that. You have to be looking for low covariance."
Robert J. Shiller
