Resources

How Does Diversification Affect Risk in Investment Analytics?

Written by Radient | Jul 18, 2023 11:31:01 AM

Diversification reduces risk in investment analytics by spreading investments across different assets. By investing in a variety of assets with non-correlated returns, losses in one investment can be offset by gains in others. This strategy lowers the overall volatility of the portfolio and minimizes the impact of individual asset performance on the entire investment.