@article {Garvey1, author = {Gerald Garvey and Ronald N. Kahn and Raffaele Savi}, title = {Practical Applications of The Dangers of Diversification: Managing Multiple Manager Portfolios }, volume = {5}, number = {2}, pages = {1--4}, year = {2017}, doi = {10.3905/pa.2017.5.2.238}, publisher = {Institutional Investor Journals Umbrella}, abstract = {Diversification is often seen as the cure for many, if not all of the evils in investing. However, is it really our strongest ally in the eternal quest for the best possible risk-adjusted returns? In The Dangers of Diversification: Managing Multiple Manager Portfolios , published in the Winter 2017 issue of The Journal of Portfolio Management , authors Gerald Garvey, Ron Kahn and Raffaele Savi of BlackRock show how combining multiple active equity managers in one portfolio dramatically increases the portfolio{\textquoteright}s exposure to widely recognized risk factors (or {\textquotedblleft}smart betas{\textquotedblright}). By demonstrating how provider diversification breeds investment concentration, the article illustrates the difficulty that investors face if they seek to capture {\textquotedblleft}true alpha.{\textquotedblright} Their findings reinforce the importance of selecting managers that provide orthogonal risk exposures.}, issn = {2329-0196}, URL = {https://pa.pm-research.com/content/5/2/1.7}, eprint = {https://pa.pm-research.com/content/5/2/1.7.full.pdf}, journal = {Practical Applications} }