What are some of the most important reasons for diversifying one's portfolio internationally and across asset classes?
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What are some of the most important reasons for diversifying one's portfolio internationally and across asset classes?
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Solution Summary
In three paragraphs, the concerts of diversification and risk management are discusses including examples of how the diversification can work.
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The most important reason for portfolio diversification is to minimize risk. It is said that a good diversified portfolio reduces about 70% of investment risk. The international economics are certainly different from domestic economics. For example, the U.S. is currently facing an economic slowdown and possible recession, but China and some other ...
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