What market risk is not
Do not confuse market risk with concentration risk. Market risk is the risk of the entire share market declining. It is not the same as one share performing poorl y. You do not need concentration ri sk. You should not be exposed to concentration risk unless you can lose all or a large part of your capital. Even large established global companies have dwindled into insignificance or even disappeared entirely. If your financial future depends on that one share for your financial future, rather diversify. Investors hardly ever design concentrated portfolios i ntentionally. You may have inherited the shares. You may have received the shares as a bonus. The shares might have grown so much that it is now a disproportional part of your portfolio. It is not easy to correct these positions. If you do, remind yourself that you are not making the decision to get the best return (that share might continue to perform very well). You are simply lowering your risk.
Also, do not confuse market risk with owning poor i nvestments. Small companies are dangerous investments if you are not an expert investor. People often buy them on ‘tips’. Tips may be i l l egal i f t he i nformation comes from an insider. Tips are also dangerous.