Diversification is even better than a free lunch – study

Data back to 1926 shows that spreading bets brings higher returns as well as lower risk

Eggs in one basket

At first, the Emory University endowment’s all-in bet on Coca-Cola, which began with a $105 million gift of shares in 1979, seemed to be paying off.

From 1980 to 1997, the cumulative return of the soft drinks company’s stock beat a broad market portfolio by more than 400% and propelled the fund to more than $3 billion.

By 2000 the Emory endowment had more than half its money in Coca-Cola shares. But by then the stock was tumbling, its value down a third from a peak in 1998.

Coca-Cola went on

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