For decades, portfolio diversification has been a cornerstone of investment strategy, widely accepted as a time-tested method to mitigate risk and weather market volatility. Yet, recent years have challenged this principle, as concentrated portfolios — often heavily weighted toward a handful of high-performing stocks — delivered outsized returns, testing the resolve of even the most disciplined investors.

Recent market volatility highlights diversification's enduring value, with non-U.S. equities and real assets performing well. Despite U.S. equity declines, diversified portfolios benefit disciplined investors, emphasizing the importance of maintaining a balanced approach.