Diversification: Difference between revisions
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imported>Doug Williamson (Add link.) |
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== See also == | == See also == | ||
* [[Credit risk diversification]] | * [[Credit risk diversification]] | ||
* [[Diversifiable risk]] | |||
* [[Portfolio]] | * [[Portfolio]] | ||
* [[Specific risk]] | * [[Specific risk]] | ||
Revision as of 22:16, 5 December 2016
Risk management.
The process of spreading risk such that no single event can have a catastrophic effect.
Often referred to as 'Don't put all your eggs in the same basket'.
In corporate finance the term is often used to mean the process of ensuring that an investment portfolio is constructed such that all possible specific risk (diversifiable risk) is eliminated.
Diversification is a form of risk reduction.
