How to diversify portfolio by age
- how diverse should my stock portfolio be
- how diversified should my stock portfolio be
- how diverse should your stock portfolio be
- how diverse should my investment portfolio be
Best diversified portfolio stocks!
How to Diversify Your Portfolio Beyond Stocks
One thing even new investors understand is the concept of diversification, or the blending of asset classes to reduce risk.
But even with a well-diversified stock portfolio, an individual is still exposed to market risk (or systematic risk), which cannot be reduced by adding additional stocks.
Portfolio diversification calculator
Below, we discuss the principles of diversification and how investors can build a truly diversified portfolio.
Key Takeaways
- A well-diversified portfolio can mitigate the exposure to market risk.
- Diversification works by spreading your investments among a variety of asset classes: stocks, bonds, cash, Treasury bills (T-bills), real estate, precious metals, etc.
- The different assets should have a low correlation to each other, meaning that they move in exact opposition.
- Investing fully in stocks is considered riskier than a portfolio with a more diversified set of asset classes, since it can be hit incredibly hard by a market crash.
What Exactly Is Diversification?
Diversification works by spreading your investment
- how diversified should your stock portfolio be
- how diverse should your investment portfolio be