Doesn't that assume that you have enough money to properly diversify without the transaction costs being too much as a percentage? If you are going to buy 500

Doesn't that assume that you have enough money to properly diversify without the transaction costs being too much as a percentage? If you are going to buy 500 stocks to get the same diversity, then at $10 per trade fee, that's a lot of money. Seems like for most people, there would be a tax management/diversity trade off. I would think that a combination of individual stocks and index funds would probably be good for most people.