Why it matters
A portfolio can hold dozens of tickers and still concentrate the majority of its risk in a single sector, a single factor (growth, momentum), or a single geography. The indicator looks past the number of holdings to the structural spread of exposure.
How the indicator is computed
After aggregating holdings by symbol, the diagnostic groups positions by sector and asset type, then computes the largest sector weight and the combined top-five exposure. Both inform the score, which is clamped between 35 and 96.
What the advisor verifies
Whether structural concentration is intentional (a thesis-driven tilt) or accidental, whether the portfolio is being measured against the right benchmark, and whether rebalancing or restructuring would improve resilience without sacrificing the household's return objective.
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