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You can use index funds or exchange traded funds to track a broader market index. This gives you exposure to many different types of companies, without your individual research required. Furthermore, your money is allocated between many sectors, so if financial companies hit a rough patch, perhaps your oil companies will be doing well. For large-cap (large-cap = big company!) international exposure, there are a lot of good options for you. The most diversified funds will have exposure to the largest sectors of the US economy, and are generally linked to a broad market index (like the Dow Jones or S&P). For diversification, stick with the index funds, as they will incorporate a variety of company types. The most widely held index fund type is the S&P 500 index funds. These, however do not diversify down into mid and small caps. or international. One might want to ad these other indeces as well for a more diversified portfolio. bonds also need to be diversified - a total stock bond index fund is a good start there...look at VTSAX, VGTSX and VBMFX as a starting point-other companies have these type funds. If you wish to own individual stocks, over 1100 companies have Dividend Reinvestment Plans (DRPs). These are companies that, at a minimum, allow you to reinvest your dividends in their stock at no fees. Many of these companies have Optional Cash Purchase Plans (OCPs) that allow you to purchase additional shares in the company at no fee. Usually, you must own at least 1 share in the company. After that you can register in the DRP and purchase shares with the dividends or through the OCP. See the link for more information on DRPs.

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βˆ™ 2016-04-08 13:44:51
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Q: How can a small investor diversify their stock portfolio?
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Investing in a widely diversified portfolio of stocks does not eliminate the risk that the whole market rises and falls?

no. If you are not a stock riots investor you should diversify because diversification is just protection against ignorance because a real investor won’t care about fluctuations in the market because they will care about the underlying value of a security. If you aren’t a serious investor then you should diversify. if you are a serious investor then you shouldn’t diversify because you know what your doing and you prefer down times so you can buy more undervalued securities.


What is sketches for your folio?

If you are an artist you may have sketches in your portfolio. If you are an investor you may have stock certificates.


How does one use stock options?

One uses stock options as an opportunity to diversify their holdings beyond traditional investments and to protect one's portfolio against unwanted risks.


Who was affected by the stock market crash?

deifnitely a small investor


How do you earn money in stock markets?

Buy low and sell high baby! ************************** You can either invest in growth stocks and wait until they increase in value, or you can invest in stocks that pay the investor a dividend for each share of the company they are investing in. Most people diversify and allot a percentage of their portfolio to various sectors of the market.


What is an investor?

An Investor is someone who buys stocks..Eg..I am a investor becasue i by into a stock


What is a stock portfolio?

A stock portfolio is all the stocks that you own. I would venture to say that if you had one stock in any company, you would have one stock in your portfolio. If you had 5 different stocks, you would have a total of 5 stocks in your portfolio.


What are ETFs in connection with the Canadian stock market?

An ETF is an Exchange Traded Funds. It allows an investor to purchase a large portfolio of stocks, diversifying an investment. Many of these securities are available on the Canadian stock exchange.


What is the average percentage a stock investor receives for investing for you?

The average percentage a stock investor receives for investing for you is about 10-15%. However, that will also depend on the stock investor's reputation.


Model test paper of ncfm investment analysis and portfolio management?

A portfolio comprises of two stock A and B. Stock A gives a return of 9% and Stock B gives a return of 6%. Stock A has a weight of 60% in the portfolio. What is the portfolio return?


What does market return mean?

Market return is the return on the market as a whole, called the market portfolio. A return in the stock market is the yield or profit that an investor earns from a security.


How would the risk of investing in a single stock compare with the risk of investing in a mutual fund?

If you are a serious investor you shouldn’t diversify. If you arent a stock riots investor you should diversify. A low cost index fund far outperforms most hedge funds and mutual funds over the long term. But volatility does not measure risk at all. Risk is measured by the actual risk of the business such as competitor.

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