An essential ingredient of an effective investment strategy is
A)enough money to diversify.
B)a good broker.
C)blue-chip stock selections.
D)high-income securities.
E)a bull market.

Question

Quizplus · Accepted Answer

Diversification is a crucial aspect of an effective investment strategy as it helps reduce risk by spreading your investments across different assets classes and sectors. Having enough money to diversify allows you to create a portfolio that aligns with your financial objectives and risk tolerance. A good broker, blue-chip stock selections, high-income securities, and a bull market can all be beneficial, but without diversification, your portfolio is at risk of being too concentrated in one or a few assets, which can lead to significant losses.

An Essential Ingredient of an Effective Investment Strategy Is