Risk
What is diversification?
Spreading money across different investments so one bad result cannot ruin you.
Explained in more detail
The point is not to maximise returns. The point is to make sure no single company, sector or decision can take out a large part of your savings.
An example
For instanceTen companies across five industries is more diversified than five banks.
Why this matters to you
You will meet this word in broker apps, company results and market news. Knowing what it means is not the goal on its own. The goal is being able to judge whether a number is good or bad for the investment you are actually holding.
On AlphaVik, any time diversification appears in a view or a lesson, you can hover or tap the word and this explanation comes with it. You never have to leave the page to look something up.