By considering families of radial null geodesics, we study the subsets of i
nitial data that lead to naked singularities and black holes in inhomogeneo
us spherical dust collapse. We introduce the notion of central homogeneity
for spherical dust collapse and prove that, for the occurrence of naked sin
gularities, the initial data set must in general he centrally homogeneous.
Even though mathematically this indicates that naked singularities are in g
eneral unstable, we show that centrally inhomogeneous perturbations in the
initial data are not physically reasonable. This provides an example of the
fact that instability in this context deduced with respect to general pert
urbations can become stabilized once the class of perturbations is restrict
ed to be physical, This is a potentially important point to bear in mind in
the general debates regarding the generic presence of naked singularities
in gravitational collapse and in more general debates concerning the questi
ons of genericity in general relativity.