Diversification – a risk mitigation strategy giving flavors of different asset classes
‘Don’t put all your eggs in one basket’ is the most commonly used and popular idiom in the financial world which has proved effective over a long period of time
‘Don’t put all your eggs in one basket’ is the most commonly used and popular idiom in the financial world which has proved effective over a long period of time. Different asset classes namely debt, equity and gold have different characteristics. Like for instance, equity offers capital appreciation, debt offers capital preservation and gold acts as a safe haven. Each of these assets perform differently every calendar year and hence it is crucial to build a well-diversified portfolio. Diversification will give flavors of different asset classes, investment products, strategies and also have following merits:
Building of the diversified portfolio requires:
