How I'd Invest $20,000 Today If I Had To Start From Scratch
If there were a Mount Rushmore of investing advice, the words "make sure you have diversification" would surely be up there. Diversifying company size, sector, and geographic location is important because you don't want your portfolio to rely on too few factors. There can be upsides to concentrated portfolios, but the downsides are usually much worse (and more likely to happen in the long term).
Ideally, you want a portfolio of at least 25 stocks, but instead of focusing on individual companies, I would invest in exchange-traded funds (ETFs), which allow you to invest in many companies at once. It doesn't take many ETFs to get the job done, either.
If I had to start from scratch, I would invest $20,000 in these three ETFs.
Source Fool.com
