In the investment world, the debate over whether to concentrate or diversify one's portfolio has been ongoing. This time, let's explore this topic.

Ordinary investors believe in diversification to reduce risk. They argue that while the probability of one company failing might be 50%, the chance of three companies failing simultaneously is much lower. Even if one company fails, its impact on the overall portfolio would be limited and manageable.

Seasoned investors, however, contend that after thorough research and selection, the chance of a chosen investment failing is less than 10%. Forcing diversification by adding less-understood companies (each with a 50% failure risk) actually increases the portfolio's overall risk. Thus, they believe concentration is the better risk-reduction strategy.

As Retail Investor Y explains: Buying near book value means your long-term return equals the company's ROE. With dividends and rights adjustments, your cost basis keeps decreasing below the current price while dividend income grows, making you indifferent to price fluctuations - "I'm already at the ocean floor, unaffected by surface waves."

But astute netizens counter: While buying Moutai at 100 yuan seems brilliant in hindsight, at purchase time all stocks carry risk - even Moutai. Imagine an extreme case where a meteor destroys all Moutai's cellars - that "100-yuan bargain" becomes a failed investment.

So which truly mitigates risk - concentration or diversification? Only through a prismatic lens can we see clearly.