Goldman Sachs conducts a regular survey of large investment managers, and the latest version featured findings from 880 hedge funds overseeing a gross total of $2.1 trillion in stock positions. The firm discovered that the "density" of hedge fund holdings is the highest since at least 2002, meaning they're holding a big percentage of their portfolios in their top 10 stock picks. This is creating a dangerous situation for investors in the event of a severe market downturn — one that could worsen any major sell-off. As an investor, it's one thing to have conviction in your decisions.