Dr.PI
April 23, 2023, 7:15pm
14
There is a simple mathematical parameter describing diversification of a portfolio:
The Herfindahl index (also known as Herfindahl–Hirschman Index, HHI, or sometimes HHI-score) is a measure of the size of firms in relation to the industry they are in and is an indicator of the amount of competition among them. Named after economists Orris C. Herfindahl and Albert O. Hirschman, it is an economic concept widely applied in competition law, antitrust regulation, and technology management. HHI has continued to be used by antitrust authorities, primarily to evaluate and underst HHI i...
https://investiforum.medium.com/the-herfindahl-hirschman-index-how-diversified-are-your-etfs-f7ab4389d311
You may want to take a look at it.
And I also see that this website even provides calculated HHI for ETFs:
Analysis of the Vanguard Total World Stock ETF ETF (VT). Holdings, Costs, Performance,
Fundamentals, Valuations and Rating.
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