Konstantinos Kousouris @Le_kousou: "🚨 Copy Trading 20 Investors?..."

United Kingdom

🚨 Copy Trading 20 Investors? That’s Not Diversification. It’s dilution. One of the biggest misconceptions I see on eToro is this: 👉 “If I copy many Popular investors, I’m more diversified and safer.” Not necessarily. Let’s break this down. 🎭 The Illusion of Diversification If you copy 15–20 investors who all follow the same long-term equity strategy, what are you really doing? • You’re buying overlapping stocks • You’re duplicating similar portfolios • You’re neutralizing strong conviction • You’re averaging everyone’s ideas into mediocrity In many cases, they already hold diversified portfolios themselves. So by copying many similar investors, you’re just layering diversification on top of diversification. The result? 📉 Over-diversification 📉 Lower conviction 📉 Smaller, diluted returns At that point, you might as well buy an index. 🎯 What Actually Makes Sense Copy trading is a powerful tool. Let me be clear: it’s one of the best features of the platform. But it works best when used strategically, not randomly. Instead of copying 20 long-term investors, consider: • One strong long-term equity investor • One crypto-focused investor • One FX or macro trader • Maybe one tactical / short-term trader • Or any other strategy you find appealing That’s real strategic diversification — different asset classes, different time horizons, different risk exposures. 🧠 The Real Risk You’re Managing When you copy a solid long-term investor, you already get diversification through their stock selection. The main additional risk you take is manager risk — their decision-making ability. So yes, adding one more strong investor can reduce that risk. But copying 10 more with similar strategies? Now they start canceling each other out. You end up owning a very broad, very average network of positions. And average rarely outperforms. 📊 My View If someone wants strong returns with reasonable risk, in my opinion, they should focus on: ✔️ A few high-quality investors ✔️ Different strategies ✔️ Clear performance metrics ✔️ Proven risk management We’ve discussed some of these metrics in previous posts — and we’ll go deeper in future ones. More is not always better. Better is better. If your goal is to “own everything,” that’s fine — indexes exist for that. But if your goal is performance with structure, intentional allocation matters. I would love to hear your thoughts! See you in the comment section! 🧠 Disclaimer: This is not financial advice. This is an educational post meant to encourage critical thinking. Every investor is responsible for their own decisions and risk management. $V (Visa) $BABA (Alibaba-ADR) $OIL $SPX500 $GOLD

Agree - Less is More

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Disagree - More PIs the better

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