What Is a Diversified Portfolio? A Guide to Smarter Investing
Investing is all about balancing risk and reward, and one strategy that seeks to do this is portfolio diversification. A diversified portfolio spreads investments across different asset classes, industries, and geographical regions to reduce risk and improve long-term stability.
The concept is simple: rather than relying on a single investment to generate returns, diversification intends to establish a portfolio that isn’t overly exposed to the ups and downs of any one asset. By managing risk in this way, investors can seek to protect themselves from market volatility while maximizing potential returns over time.
