answersLogoWhite

0

An investment portfolio can only be considered "diverse" if it consists of multiple different types of investments. When thinking of investments, the most common types that come to mind are stocks, bonds, and mutual funds. It's important not to forget to have other types in your portfolio. For example, do not forget about cash investments. Usually shorter term investments, or something as simple as putting money in a savings account, it's important to keep a small amount invested in cash.

User Avatar

Wiki User

15y ago

What else can I help you with?

Continue Learning about Finance

Distinguish between foreign direct investment and portfolio investment?

Foreign direct investment is the provision of capital into a company or project by a financier who is from a foreign country. In portfolio investment, anyone can invest in the portfolio, whether or not he is from a local company or a foreign company.


What would not be part of an investment portfolio?

An investment portfolio is a group of investments in which an investor intends to make a profit on the original invested money. A savings 529 plan would not be included in a investment portfolio as it is an education savings plan not an investment plan.


How can diversification help you deal with risk in your investment portfolio?

Diversification can help reduce risk in your investment portfolio by spreading your investments across different asset classes, industries, and geographic regions. This way, if one investment performs poorly, the impact on your overall portfolio is minimized.


What is the personalized rate of return for my investment portfolio?

The personalized rate of return for your investment portfolio is the percentage increase or decrease in the value of your investments over a specific period, taking into account the individual assets and their performance in your portfolio.


Why is diversification important in an investment portfolio?

Diversification is important in an investment portfolio because it helps reduce risk by spreading investments across different asset classes. This can help protect against losses in any one investment and improve the overall stability and potential returns of the portfolio.

Related Questions

How can we call a Company with a diverse portfolio of businesses?

company with a diverse portfolio of businesses


Distinguish between foreign direct investment and portfolio investment?

Foreign direct investment is the provision of capital into a company or project by a financier who is from a foreign country. In portfolio investment, anyone can invest in the portfolio, whether or not he is from a local company or a foreign company.


What would not be part of an investment portfolio?

An investment portfolio is a group of investments in which an investor intends to make a profit on the original invested money. A savings 529 plan would not be included in a investment portfolio as it is an education savings plan not an investment plan.


What is meant by the term portfolio investment?

Portfolio investment refers to investments in foreign countries that are withdrawable at short notice, such as investment in foreign stocks and bonds.


Can Diversification reduce the weight of an investment in a portfolio compared to an undiversified portfolio?

Yes; that is the definition and purpose of diversification: to spread the invested money over a number of investments so that no single investment has a high percentage of the investor's money, thus reducing risk.


How can diversification help you deal with risk in your investment portfolio?

Diversification can help reduce risk in your investment portfolio by spreading your investments across different asset classes, industries, and geographic regions. This way, if one investment performs poorly, the impact on your overall portfolio is minimized.


What is the personalized rate of return for my investment portfolio?

The personalized rate of return for your investment portfolio is the percentage increase or decrease in the value of your investments over a specific period, taking into account the individual assets and their performance in your portfolio.


Why is diversification important in an investment portfolio?

Diversification is important in an investment portfolio because it helps reduce risk by spreading investments across different asset classes. This can help protect against losses in any one investment and improve the overall stability and potential returns of the portfolio.


What are the disadvantages of portfolio investment?

u lose everything


What is the impact of using the Robinhood FIFO method on my investment portfolio?

Using the Robinhood FIFO method can impact your investment portfolio by determining the order in which your stocks are sold, which can affect your tax liability and overall investment returns.


What is scrip?

scrip lending is when a Collective Investment Fund or Portfolio borrows money to repurchase from another Portfolio


What is the current net account value of my investment portfolio?

The current net account value of your investment portfolio is the total value of all your investments after subtracting any fees or expenses.