Motley Fool argues stock pickers should diversify because market wealth creation has been concentrated among a small number of companies. Citing Hendrik Bessembinder's research, it says 46 firms accounted for half of stock-market value creation from 1926 to 2025.
The newsletter says about 40%–45% of stocks beat the market over one year, around 30%–35% over five years and an even smaller share over 10 years, while noting these estimates vary by source and period. Bessembinder's research also reported a median individual-stock return of negative 6.9% across 1926–2025.
In an interview with Robert Brokamp before his death in 2009, investor Peter L. Bernstein said his portfolio was essentially buy-and-hold and highly diversified. He described diversification as both protection against loss and a way to stay exposed to big winners. Motley Fool's Rule Breakers and Hidden Gems contributors similarly advocate searching broadly, letting successful holdings run and accepting that some picks will fail.
