Enhanced Returns

While diversification primarily aims to reduce risk, it can also enhance returns by exposing the portfolio to a variety of growth opportunities across different sectors and geographic locations.

Protection Against Market Uncertainty

Diversification provides a protective barrier against market uncertainty and economic changes. 반도체부품 관련주

By spreading investments, the impact of a downturn in any single market or sector is lessened.

Challenges in Diversification

While diversification is beneficial, it also comes with challenges that investors need to be aware of.

Over-Diversification

While diversification aims to reduce risk, too much diversification can dilute potential returns. Over-diversification happens when investors own too many investments, making the portfolio’s overall performance merely mirror the broader market performance.