Why a Diversified Stock Portfolio is The Best Financial Advice You Will Ever Follow
Diversification is not a common term unless you are into stock investing and portfolio management. Fidelity Investments informs us that diversification allows you to minimize your risk by spreading it among multiple different assets. For the uninitiated, what this means in plain English is that your money remains safe because you don’t put all of it in a single stock. Time Magazine tells us that the stock market dropped to its lowest point in September 2022. In an atmosphere like this, with a recession looming, a diversified stock portfolio might be the best plan for many small investors like you and me. I’m a freelance writer by trade, and I learned what I know about the stock market by reading and doing. This article was penned to help you figure out your investment options and explain why you shouldn’t put all your hopes on one stock. Let’s take a look at diversification.
Splitting Up the Risk
One of the core things that you will realize is that diversification allows you to split up the risk you’re exposing yourself to on the market. Risk, in this sense, is that the money you’ve invested could…
