Chapter 01 · Section 1.1

Portfolio diversification

Portfolio diversification means:

• a) the search for cheap securities
  No. When diversifying a portfolio it is important to know how much a specific stock contributes to reduce the general risk. A stock from a different economic sector contributes more than a stock from the same sector.
  b) the purchase of a series of different securities to compose a portfolio.
  c) the influence of various market developments

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