Diversify, but Not Too Much

We know investors shouldn't put all their eggs in one basket, but investing in too many different asset classes isn't always helpful either

Amy Arnott 15 July, 2020 | 11:15AM

Diversification

If you're a do-it-yourself investor building a portfolio, the investment options can be overwhelming. Morningstar now divides the fund universe into about 140 separate categories based on each fund's underlying holdings. But while each Morningstar Category is a little different, there's no need to add all of them - or even more than a handful - to your portfolio.

Diversification is one of the first, and most important, investment lessons you'll learn - but how much is enough, and how much is too much? Here, we explain some of the theory behind portfolio diversification by asset class and how it can affect your portfolio.

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Amy Arnott  Amy Arnott

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