Need help with the following questions. Please provide references

Q-1. In a diversified mutual fund an investor must take into account changes across a variety of stocks. A less diversified one might offer a higher degree of performance predictability. Which type of fund (if any) has a higher degree of return predictability? Explain your answer.

Q-2. In a diversified mutual fund an investor must take into account changes across a variety of stocks. A less diversified one might offer a higher degree of performance predictability. Which type of fund (if any) has a higher degree of return predictability? Explain your answer.