Create a diversified portfolio to spread risk from "summary" of Investing Basics for Beginners by Razaq Adekunle
One of the key principles of investing is to spread risk by creating a diversified portfolio. This means not putting all your eggs in one basket. By investing in a variety of different assets, you can reduce the impact that any one investment can have on your overall portfolio. If one investment performs poorly, the impact on your portfolio will be less significant because you have other investments to help balance it out.
Diversification can be achieved by investing in different asset classes, such as stocks, bonds, real estate, and commodities. Each asset class behaves differently under different market conditions, so having a mix of assets can help protect your portfolio from volatility. Within each asset class, it is also important to diversify by investing in different companies or securities. This can help reduce company-specific risk, such as poor management decisions or industry-spec...
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