Stock Market Investing 1x1: The Complete Wealth Creation Guide - How to generate sustainable cash flows and invest in highly profitable assets incl. Stocks, ETFs and Real Estate by Hammond Andrew P

Author:Hammond, Andrew P. [Hammond, Andrew P.]
Language: eng
Format: epub
Published: 2021-01-20T16:00:00+00:00

Creating a Diverse Portfolio

Another short but sweet point now. If you invest $10,000 in one company, and this is all the money you have, you’re doing the worst thing a stock investor can do by putting all your eggs in one basket. What happened if the stock loses money? Well, you lost money.

On the other hand, if you invest $1,000 in ten different companies, you’re going to win on some investments and lose on others, meaning that you’ll be able to make gains over time. Investing in multiple portfolios and creating what is known as a diverse portfolio is essential to the success of any stock trader.

Bear this point in mind when you’re creating your portfolio and choosing what companies to work with. This is all to cover your losses, minimizing what you’re losing, and then allowing you to focus on maximizing your profits.

In other words, don’t just stick with one company or stock and fully invest in it. This is a sure-fire way to lose all your money eventually.

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