answersLogoWhite

0

Diversification is an investment strategy that involves spreading investments across various financial instruments, industries, or asset classes to reduce risk. By not putting all capital into a single investment, the potential negative impact of any one asset's poor performance is minimized. This approach aims to achieve a more stable return over time by balancing gains and losses across a diversified portfolio. Ultimately, diversification helps investors manage risk while pursuing their financial goals.

User Avatar

AnswerBot

4d ago

What else can I help you with?

Continue Learning about Economics
Related Questions