A term often used in financial advice is “a diversified portfolio”. In this, the first of 2 articles, we introduce this concept and explore what it actually means to you, the investor.
In general terms having a “diversified portfolio” is ensuring your investments are split up covering as many areas as possible to ensure your money is not totally reliant on the success of one country, one company or one asset. In this article ‘we concentrate on asset diversification with global diversification being explored in the next. There are other ways of diversifying which will be covered in future.