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Stock Investing In India – What Is Diversification Of Portfolio

Portfolio diversification is a strategy that helps minimise risk and maximise returns. Read more to know the things to keep in mind while diversifying.<br>

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Stock Investing In India – What Is Diversification Of Portfolio

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  1. Stock Investing In India – What Is Diversification Of Portfolio? The stock market is highly dynamic and it is almost impossible to predict its movements. This makes investing a risky affair and one of its vital counterbalance strategies is portfolio diversification. Diversification, or distributing your investments among various asset classes, has been one of the most effective ways of mitigating risk. Diversification in the investment portfolio ensures that your assets are not exposed to high risks but generate high enough returns at the same time. This article explores portfolio diversification, its components, merits, and demerits, along with a few things for you to keep in mind while preparing your strategy. What is portfolio diversification? Portfolio diversification is a strategy of risk management used in investing, which allows you to reduce risks by allocating your funds in multiple asset types. Not only does this help to mitigate the associated risks, but it also boosts the returns on your overall investment portfolio. The main principle of diversification is to avoid putting all your eggs into a single basket. The entire idea is that you effectively manage your risk and average out the volatility. That being said, not all markets and asset classes

  2. function alike. This is why you can include some high-risk, high-return shares in your portfolio and, at the same time, incorporate safe investments. If one investment falls in value, another investment will grow if the portfolio is well balanced. The investment advisors at Teji Mandi help you diversify your portfolio with handpicked investment options that will reduce the impact of volatility and help you enjoy greater returns! Contact Us for more details. Let us now note all that is required to build a well-diversified portfolio. Components of a diversified portfolio The primary components of a well-diversified portfolio include the following investments: Bonds, stocks & mutual funds Short term investments Commodities Foreign assets Real estate funds Sector funds If you are looking for a one-stop solution to your investment-related needs, then Teji Mandi App is for you. From actively managing your portfolio at a minimal cost to easy portfolio updates, Teji Mandi offers an array of options. Have non-performing stocks? Replace it easily on our app. It is a hassle-free solution for all investment management problems.

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