J.L. Collins

And you don't want to sell it too soon because you might miss the run-up.

And if it drops, well, that might just be a temporary dip as it goes on to greater things, or it might be the beginning of the end.

So that's a constant bit of monitoring that you have to do.

Back in the day, before index funds, the idea of a diversified portfolio, as I learned it,

was you pick about eight industries, maybe 10 at the outside.

And within those industries, you pick one or two companies because nobody can effectively follow more than 15 or 20 separate companies.

And if you do that, you're across, say, eight industries and you're carrying 16 stocks, you're diversified.

Well, now with a stroke of a keyboard, I can own VTSAX and I own a piece of every publicly traded company in the United States.

And everybody from the factory floor to the CEO is working to make me richer.

And some of them will succeed.

And because it's cap weighted, they will rise to the top.

And others, not so much.

And if they don't, they will fade away.

I don't have to predict which one it is that's going to do that.

And it's kind of a rigged game in that the ones that fade away, the most they can lose is 100%.

And they usually fade off the index before they get there.

But that's the worst.

The ones on the way up can gain 100% or 2% or 3% or 1,000% or 10,000%.

So, you know, and that's the self-cleansing process I talk about.

And Robert, the other thing I'll add to that is it also applies, and this is a question I'm getting a lot these days, also applies to the sector that is leading.