Diversification Demystified: Building a Balanced Stock Portfolio
Introduction Diversification is a fundamental principle in investment strategy that is often mentioned but not always well understood. Building a balanced stock portfolio through diversification can help reduce risk, increase potential returns, and provide a cushion against market volatility. In this article, we will demystify diversification, explore its importance, and provide practical tips for constructing a well-balanced stock portfolio. Understanding Diversification Diversification is a risk management strategy that involves spreading investments across different assets, asset classes, or sectors. The idea…