They have a variety of different types of stocks in different industries. They are safe. They are diversified. It is true that diversification is an important element in building an investment portfolio. The answer is no.
Diversification is meant to reduce risk.
The current theory on Wall Street claims investors need only diversify among different types of stocks. This is not only foolish, it is dangerous. The chart above shows how diversifying among various stock funds didn't reduce risk. It did gave investors a false sense of security. The next chart shows how various indices performed during the 1998 correction.