How many stocks should I own?
If you pick individual stocks, somewhere between 15 and 30 across different industries gives most of the benefit of diversification. One index fund gets you there in a single purchase.
The research on this is old and consistent: most of the risk that comes from owning a single company disappears by the time you hold around 20 to 30 stocks in different industries. Past that, adding more does little. Below about ten, one bad company can do real damage to the whole portfolio.
The catch is that "different industries" is doing a lot of work in that sentence. Twenty tech stocks are not diversified; they will all fall together when tech falls. Spread across banks, healthcare, energy, consumer goods, industrials and so on, and the count starts to mean something.
This is also the quiet argument for index funds. A single S&P 500 fund holds 500 companies across every sector, rebalanced for you, for a fee measured in hundredths of a percent. Building that by hand takes time, money and discipline that most people would rather spend elsewhere.
A common shape that works: an index fund as the core, plus a handful of individual companies you follow closely, capped at maybe 10 to 20 percent of the total. Enough to keep it interesting, not enough to hurt.
Informational only, not financial advice. Updated September 4, 2026.
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