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From The Glossary »

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Diversification:

Pooling assets with different inherent risk factors reduces diversifiable risk. Diversification refers not only to the pooling of different kings of assets (shares and bonds), but also to different assets of the same king, e. g. having ten different shares in the portfolio. Due to the small amount an investor has available for investment, he would not be able to invest in assets which require larger amounts unless he pools his investment and shares ...
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