Getting — and staying — diversified – Strategies for keeping your portfolio on track
Abstract: One of the tenets of long-term investing is that diversification reduces a portfolio’s risk. But, while diversification is easy to understand in theory, it’s harder to execute in practice. There’s no one right way to diversify — the right approach depends on one’s individual goals and financial situation. This article discusses the challenge of getting diversification right: It’s a process that involves determining an appropriate asset allocation and regularly rebalancing assets.