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Diversification might be the most important idea in modern finance. It's the idea that if you spread your portfolio across lots of bets rather than just a few concentrated ones, you can get the same returns but for lower risk. The ways that people usually do this is investing across asset classes, stocks and bonds, and investing across regions. But there's been a problem recently. Stocks and bonds have been moving together, so rather than offsetting each other's losses, they've actually magnified them. And there's a longer term trend too. It's become over the decades a lot easier to invest across borders so more people have started doing it. But as that's happened, markets that used to move independently have started to move together, so they offer less diversification benefit. It's no wonder really that investors are turning to wilder things like cryptocurrencies or private markets to try and diversify. There's an important lesson here from financial history. Even with the very best ideas, once they go from being used by a small group of people to being used by nearly everybody, the gains start to be eroded. It's still important to diversify, to invest in both stocks and bonds, to invest across regions, and you still get some benefit from doing so. It's just that the benefits are less than they used to be. It's one of the reasons investing is so hard.