Diversification is key to managing risk from "summary" of Insights on Morgan Housel’s The Psychology of Money by Swift Reads
Diversification is a fundamental principle of investing that is often overlooked by many people. This concept essentially means spreading your investments across different assets to reduce the overall risk in your portfolio. By not putting all your eggs in one basket, you can protect yourself from the volatility of individual assets. This is because different assets tend to perform differently under various market conditions. For example, if you only invest in one stock and that company goes bankrupt, you could lose all your money. However, if you spread your investments acro...
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