LEARNING CENTER
Level | Beginner

WHAT IS DIVERSIFICATION? WHY DO YOU NEED IT?

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Key Takeaways

  1. Diversification is important in any investment strategy, in order to protect against losses and to optimize returns.
  2. Diversification can be done across asset classes and within a particular asset class.
  3. There are some external risks to your investments that you can never control or predict; diversification helps you to mitigate those risks.
  4. Balance diversification (objective being managing risk) with concentration (objective being earning returns)