Read this tip to make your life smarter, better, faster and wiser. LifeTips is the place to go when you need to know about Your Portfolio and other Investing topics.

Is there such a thing as too much diversification?

When Diversification Goes Too Far

Everyone knows that investing in too few companies will expose you to a lot of risk. However, investing in too many companies also has its risks.

In order to manage your investment portfolio optimally, avoid adding diversity for the sake of diversity. Only invest in as many stocks as you can reasonably keep track of. Keeping track of a stock includes reading annual reports and other investor information and staying on top of relevant industry news.

Comments

Nobody has commented on this tip yet. Be the first.

Ask a Question

Not finding the advice and tips you need on this Investing Tip Site? Request a Tip Now!

Guru Spotlight

Byron White

Ever wonder how you could make your life better and more fun? So have tens of millions of fans who have turned to LifeTips for answers over the past decade. We keep the tips, advice, books, podcasts and writing services flowing, so you can keep your life and business growing in the right direction. Upward!