I don't see how this can be true. If you're splitting your investment, your downsides are smaller but your upsides are also smaller, and presumably by the same amount.
> If you’re splitting your investment, your downsides are smaller but your upsides are also smaller, and presumably by the same amount.
Yes, and your expected return remains the same. Reducing variability isn’t “reducing returns”, because, as you note, what you lose from reducing the 50+nth percentile returns is made up for by increasing the 50-nth percentile returns.
