How can diversifying your investments reduce risk

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How can diversifying your investments reduce risk?

An alternative approach to hedging risk is to focus instead of diversify. In this approach, which is just the opposite of diversifying, you would only invest in one thing. In other words, instead of putting all of your eggs in several baskets you put all of your eggs in one basket and watch it very closely! How does this approach reduce risk of investing?

Reference no: EM13255506

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