A key investment strategy to reduce risk and optimize returns by spreading investments across various assets.
Diversification is the practice of spreading investments across different financial instruments, industries, and other categories to reduce exposure to any single asset or risk. The main goal is to minimize the impact of any one investment's poor performance on the overall portfolio. By holding a mix of asset classes, such as stocks, bonds, real estate, and commodities, investors can achieve more stable returns over time. It is important to regularly review and rebalance the portfolio to ensure that diversification remains aligned with investment goals and market conditions.
Do not put all your eggs in one basket.
