Definition of

Diversification

Diversification
Finance: Spreading your money across many different investments.

This can reduce the risk of losing a lot of money if any one investment fails.

Example: Alex has $35,000, and decides to diversify with these investments:
• $5,000 in gold,
• $10,000 in shares,
• $10,000 in government bonds, and
• $10,000 in a property trust.

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