3 Things Beginning Investors Get Painfully Wrong About Diversification
Diversification is one of the cornerstones of smart investing. Spreading your money around reduces your risk of loss, and it's absolutely crucial when you're talking about your life savings.
But diversification can be more complicated than a lot of people realize. If you're new to investing, here are three things to keep in mind when deciding where to stash your cash.
It's tempting to invest your savings in a handful of tech giants and call it a day, but this can actually be a really dangerous investing strategy. You'll do great when the tech industry is doing well, but if a regulatory change or some other unforeseen circumstance hits tech companies, your portfolio could plunge, even if you have your money spread between a handful of different stocks.
Source Fool.com
