Diversification is boring, a sign of weakness to many investors.
Today, the average investor wants to ride all of his or her money on the latest hot investments. Not only do many investors want all their eggs in one basket, they want the goose that lays the golden eggs in with them. More narrowly, some investors are putting most of their money in technology stocks, some of which ran up eye-popping returns in 1998. Investors look at what's happened the past year, six months, sometimes only a few weeks or days, and either bet on the hot investment, or if they are nervous about that, try to guess where the next hot investment will emerge. Investors who simply spread their investment dollars out among a diversified pool of assets and let them go for a long time without worrying about what's currently up or down seem to be scarcer than-well, than goose teeth.