gpmd1

I am diversified. I just like using Canadian banks as an example. 

I do also feel it is important to do a couple other things. 

First, you need to understand what you invest in.  This is why, for example I avoid the 'Brookfield' group of companies.  They are very highly rated, even by J. Heinzl who I respect greatly, but they are difficult to truly understand. 

Second, I recognize that if a company, no matter how good, gets so overpriced that the money could be invested better elsewhere, I sell.  I can always buy back in if/when valuations return to more normal/reasonable levels.  Right now, for example I don't see Canadian banks as grossly overvalued.  I wouldn't buy more right now, but I'm not looking to sell, either.