Diversification is a big word for a simple idea: don’t bet everything on one thing. If you own many different things, one of them having a bad day won’t sink you.
If you carry all your eggs in one basket and drop it, every egg breaks. Spread them across a few baskets and a slip only costs you one.
Different things also tend to zig and zag at different times. When one is down, another might be up — and that balance smooths out the bumps.
Where these numbers come from
Finisdom’s Correlations page shows which things tend to move together and which move apart — handy for picking a mix that balances out.
See the Correlations pagePart of the Finisdom app — sign in to open it.