53% of the time, it worked every time

Morgan Stanley quantifies single-stock concentration risk. Pope memes. TGIF.

Morgan Stanley: Confronting the Concentrated Equity Challenge and Measuring Drawdown Vulnerability (Jan 2025).

This is a great paper full of clear and persuasive charts and graphs. Here are a few of my favorites.

This paper doesn’t mention tax, but single-stock concentration is endemic, and tax is one reason people hold.