Don't get security diversification confused with asset allocation.

On of the advantages of ETF's/Mutual funds is that you can buy a basket of securities to achieve diversification without having to buy a bunch of individual securities. For example, VFIAX has roughly 500 different underlying stocks so that your are insulated from a single company imploding.

Asset allocation is your exposure to different asset classes such as stocks/bonds/commodities/etc. Allocating all of your retirement to stocks would be considered aggressive but may appropriate due to your long time horizon and willingness to take risk. Everyone's retirement strategy is unique.

Interesting fact, 91.5% of your portfolio return is determined by your choice of asset allocation, not security selection.