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In finance, diversification is the process of allocating capital in a way that reduces the exposure to any one particular asset or risk. A common path towards diversification is to reduce risk or volatility by investing in a variety of assets .
Diversification involves spreading your money across a variety of investments and asset classes. A diversified portfolio helps to reduce risk and may lead to a higher return.
Example investment portfolio with a diverse asset allocation. Asset allocation is the implementation of an investment strategy that attempts to balance risk versus reward by adjusting the percentage of each asset in an investment portfolio according to the investor's risk tolerance, goals and investment time frame. [1]
For strategic planning to work, it needs to include some formality (i.e., including an analysis of the internal and external environment and the stipulation of strategies, goals and plans based on these analyses), comprehensiveness (i.e., producing many strategic options before selecting the course to follow) and careful stakeholder management ...
Strategic planning is an organisation’s process to outlining and defining its strategy, direction it is going. This led to decision making and allocation of resources inline with this strategy. Some techniques used in strategic planning includes: SWOT analysis, PEST analysis, STEER analysis.
What Buffett has said about diversification. The so-called Oracle of Omaha didn't mince words with his comments on diversification, which is a tried-and-true investment tactic. In short, he came ...
Diversification (finance) involves spreading investments; Diversification (marketing strategy) is a corporate strategy to increase market penetration; Diversification of firms through mergers and acquisitions
Portfolio optimization is the process of selecting an optimal portfolio (asset distribution), out of a set of considered portfolios, according to some objective.The objective typically maximizes factors such as expected return, and minimizes costs like financial risk, resulting in a multi-objective optimization problem.