It’s great that you’ve seen such a strong run with Royal Bank, but you’re right to be looking at the overlap. Having 80% of your portfolio in one stock is a massive amount of concentration risk. Generally, when a single position exceeds 10–15%, most advisors start looking at "de-risking" because your entire financial future becomes tied to the fate of just one company. Royal is a good company to make that bet on, sure, but it's still not a bet most would make.
HCAL is a "leveraged" play. It uses 25% leverage to amplify the returns of the Big Six banks. This has worked beautifully during this recent bull run, but leverage is a double-edged sword. If the banking sector slows down or corrects, HCAL will see extra downside compared to the individual stocks because of that leverage. If you think the banks might have a slower year in 2026, would be completely fair to just move to a non leveraged fund like HEB.
With VDY, Royal Bank is almost always the #1 holding in this ETF (usually around 13–15%). So, by owning RY, HCAL, and VDY, you are effectively "triple-weighting" your exposure to Royal Bank.
Ultimately, because I don't know your full financial picture (your age, total goals, or tax situation regarding capital gains), I can't say exactly what you should do. However, if you're feeling uneasy about the "huge run," it’s often a sign that your risk tolerance is being tested.
Because VDY and HCAL (or HEB, if you choose to switch) give you broader exposure to a lot more holdings while still holding Royal inside of them, it seems like the viable option would be selling the individual position. However, again, I don't know the entire situation.