It's Not Rocket Science, summarized below
If you're comfortable with your entire portfolio, Bradley argues you may not be diversified enough. When trends have been going on for several years, portfolios become less and less diverse, as investors become convinced that what was successful in the past will continue to be successful. This is dangerous, however. Energy stocks and real-estate will not go up forever!
The same goes for geographic diversity. If an investor believes a country or a group of countries is going to outperform the rest, he is probably not diversified enough. Strong past performance usually indicates a correction will occur.
That's not to say Bradley believes in owning a multitude of stocks. He is a proponent of portfolios that are far more concentrated than the average mutual fund. Statistical analyses suggest the diversification benefits become negligible after about 20-25 holdings. But a caveat is that these holdings should not all carry the same themes, such as being based on endless growth from "Chindia" and rising oil prices.