effectively if you are going to take on a project with highier risk then this wouldn't reduce your overall risk. However diversification in theory is supposed to reduce risk?
2007-01-05 00:33:07 · 2 answers · asked by Anonymous in Business & Finance ➔ Other - Business & Finance
It's not that black and white. In theory, with unlimited resources, the chances of generating some form of success increases with the number of activities deployed. However in real life resources are limited, so if you spread these resources too thin by deploying too many activities actually decreases your chances for overall success.
Like evrything in life, it's a balance.
2007-01-05 00:38:53 · answer #1 · answered by Martin D 3 · 0⤊ 0⤋
if your goals is risk management, consider putting some money in a savings account whenever you take a flyer at a high risk investment. your overall risk will be balanced.
point is to manage returns. so do homework. if you're looking at a higher risk option, do more homework. find out who is already invested in the option and seek information on why when how much how long,etc. consider working with a female broker at a reputable firm, i.e. AGEdwards.
2007-01-05 08:49:36 · answer #2 · answered by bardmere 5 · 0⤊ 0⤋