The problem I have is how diversification occurs in practice.
If I were to tell you I have the following companies in my portfolio:
Social media, cloud infrastructure, e-commerce/cloud infrastructure, entertainment, electronic products, search
YouTube might review this portfolio and say:
2 infrastructure plays may add some concentration or ad revenue may be involved in 3 of those.
Other Than that, basically all different.
Problem is if I list the, like this:
META, MSFT, AMZN, NFLX, AAPL, GOOG everyone says your too concentrated.
I think portfolios would be better served looking at diversification on the basis of revenue and cash flow similarities compared to trading similarities. In the short term, trading correlations may make the portfolio move together, longer term cash flows and profits will drive the stock and diversification will come from diversifying those cash flows.