A Look at Diversification

A Look at Diversification

Diversification is an investment principle designed to manage risk, but it can't prevent against a loss.

Ancient Chinese merchants are said to have developed a unique way to reduce their risk. They would divide their shipments among several different vessels. That way, if one ship were to sink or be attacked by pirates, the rest stood a good chance of getting through and the majority of the shipment could be saved.

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