Is your portfolio diversified enough? Rebalancing and correlation

Two kinds of concentration

Owning many stocks does not mean being diversified. Risk concentrates in two ways: too much money in one position or sector, and too many holdings that move together. Eyrie checks both, using the portfolio you already entered.

Rebalancing: limits on stocks and sectors

Rebalancing reads your combined stock allocation and compares it with maximum limits, which you can edit. The defaults are 8% per stock and 25% per sector.

For every breach it shows how far above the limit you are, the amount you would need to sell to get back to it, and a suggested quantity when known. It does not place trades; it is guidance for you to act on in Add Stock Transaction.

• Stocks without a sector show up separately so you can assign one.
• If a current price is missing it falls back to invested value so nothing silently disappears.

Correlation: do your holdings move together?

The Correlation Matrix measures how daily returns of your holdings move relative to each other (Pearson correlation). Two stocks in different sectors can still behave alike, which weakens diversification.

It looks at your largest holdings by value (up to 22) and needs at least 30 overlapping trading days for a pair. You can switch between a stock view and a sector view, and see the average correlation, strongest and weakest pairs and a diversification rating.

Reading them together

Start from Holdings, run Rebalancing, then check correlation. If you decide to trim, remember the tax impact and look at first.