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Purpose
This doctrine establishes the maximum allowable capital allocation for any individual stock in the Micro Harvesting Portfolio in order to preserve diversification, structural balance, and portfolio discipline.
It exists to ensure that the portfolio remains a multi-stock harvesting system and does not gradually drift into a concentrated structure dominated by one position.
Core Principle
No single stock shall be allowed to grow to a size that materially weakens the diversification logic of the portfolio.
Under Micro Harvesting, diversification is not decorative. It is part of the operating structure of the system.
Standard Ceiling
Each stock shall normally be subject to a standard capital allocation ceiling of 10% of total planned portfolio capital allocation.
This 10% level shall serve as the default constitutional limit for normal stock sizing within the portfolio.
Any stock at or below 10% shall be treated as within normal diversification bounds.
Override Zone
A stock may, under controlled governance conditions, be allowed to operate above 10% but not beyond 15% of total planned portfolio capital allocation.
This range shall be known as the Override Zone.
The Override Zone is a controlled exception, not a second normal ceiling. Its purpose is to allow limited flexibility for a stock that has earned temporary or structural justification for occupying a larger allocation.
One-Stock-Only Rule
At no time shall more than one stock occupy the Override Zone.
No second stock may be allowed above the standard 10% ceiling unless the first stock in the Override Zone has already returned to 10% or below.
This rule preserves the diversified character of the portfolio and prevents repeated exceptions from becoming silent concentration.
Hard Ceiling
The 15% level is a hard ceiling.
No stock shall be allowed to exceed 15% of total planned portfolio capital allocation under this doctrine.
Any stock above 15% shall be recognized as a Drift Condition.
Anything above 15% is a gateway to drift.
Meaning of a Drift Condition
A stock above 15% is no longer simply elevated or exceptionally sized. It has moved outside the allowable structure of this doctrine.
A Drift Condition requires:
- governance acknowledgment,
- corrective restraint,
- and prevention of further expansion.
Corrective action does not automatically require forced selling, but the position shall no longer be treated as constitutionally compliant.
Conditions for Override Eligibility
A stock may be allowed to occupy the Override Zone only when all of the following are true:
1. Active portfolio role
The stock must already be an active and established part of the Micro Harvesting operating structure.
2. No governance distress
The stock must not be under unresolved thesis breakdown, exceptional governance stress, or known operator discomfort.
3. Portfolio identity preserved
Its increased allocation must remain consistent with Micro Harvesting as a diversified harvesting portfolio, not a disguised one-stock conviction structure.
4. No material diversification distortion
Allowing the stock to exceed 10% must not materially distort the balance of the broader portfolio.
5. Valid justification exists
There must be a reasonable governance basis for the override, such as:
- mature trust status,
- proven productive contribution,
- strategic portfolio role,
- or organic drift arising from legacy structure, accumulated strength, or natural system behavior rather than impulsive oversizing.
Nature of the Override
The Override Zone is an allowance, not an entitlement.
A stock is not automatically entitled to move above 10% merely because it is profitable, familiar, or favored by the operator.
The burden of discipline remains with the operator.
What This Doctrine Does Not Require
This doctrine does not automatically require:
- panic selling,
- emotional rebalancing,
- or mechanical forced reduction the moment a stock enters the Override Zone.
Its purpose is to provide a clear structural boundary, not to punish strength.
Suggested Interpretation Bands
For dashboard and governance reading, the following interpretation bands may be used:
- 0% to 8% = Healthy
- Above 8% to 10% = Elevated but Constitutional
- Above 10% to 15% = Override Zone
- Above 15% = Drift Condition
Formal Rule
Each stock shall normally be subject to a standard capital allocation ceiling of 10% of total planned portfolio capital allocation.
A stock may, under controlled override conditions, be allowed to operate above 10% but not beyond 15%. This Override Zone is limited to one stock at any given time.
The 15% level is a hard ceiling. No stock shall be allowed to exceed 15% under this doctrine. Any position above 15% shall be recognized as a Drift Condition requiring governance acknowledgment and corrective restraint.
No second stock may enter the Override Zone unless the first has already returned to 10% or below.
Closing Note
This doctrine protects the diversified nature of Micro Harvesting without making the system brittle.
It allows one carefully governed exception, but it keeps the constitutional line intact.
The 10% ceiling preserves normal discipline.
The 15% hard ceiling prevents drift.
The one-stock-only override rule keeps the exception from becoming the habit.
Change Log
v1.0 — April 5, 2026
Initial codification and lock-in of the Individual Stock Capital Allocation Doctrine, establishing a 10% standard ceiling, a one-stock-only override zone up to 15%, and a hard ceiling to prevent portfolio drift.
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