Owning lots of funds doesn't mean you're diversified. More than half of large-cap growth funds, for example, list Google among their top 10 holdings, according to fund data provider Lipper.
And if you and your spouse each have a 401(k), IRA and brokerage account, chances are your investments suffer from a serious case of asset overlap.
"Investors often stick to the same funds in every account and don't pay attention to the diversification of the total portfolio," says Tom Roseen, a senior research analyst at Lipper.
Many funds, little diversification
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