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Diversify your Investment Portfolio |
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Monday, 30 April 2007 |
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Spreading your risk between 10 different securities across different sectors reduces your odds of losing your entire capital on a single stock or industry sector.
Diversifying across different sectors is important because when the economy is digging itself out of recession, certain sectors whose profits are particularly enhanced by falling interest rates put in their best price performance. Then as the economy moves into the terminal recovery phase, the outperforming issues start to decline, but the market
averages are buoyed by previous underperforming issues, which thrive in this
kind of environment.
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Investing Ideas 
