Portfolio concentration
What it shows
How much the portfolio relies on a single position. The main number is the largest position's share; HHI (0–1) summarizes dispersion. A structural measure, not a judgement.
How to read it
Higher concentration = greater portfolio sensitivity to a single asset (both ways). It is information about risk structure, not a recommendation to change.
Parameters
- HHI / largest position share
- HHI closer to 1 = capital concentrated in few assets; closer to 0 = spread out.
- Positive reading: HHI < 0.15: the portfolio is broadly diversified.
- Negative reading: HHI ≥ 0.25: high concentration; the portfolio hinges on one asset.
- Neutral reading: HHI 0.15–0.25: moderate concentration.