Introduction
In the ever busy world of business, investment has being an essential key to growing wealth and maintaining dominance in the global market. Aside that, small scale investment are also common among those who can maintain the little dominance around their cycle. The purpose for investment is practically to grow and get fare rewards periodically.
When we talk about market dominance, Black rock is always the first fact that comes to my mind, seeing how this body have dominated the market in recent years. Their partners are great investors in large company firms. Their main idea is to keep enlarging their capital by investing in all necessary areas as possible.
Black rock is basically performing some diversification in different sectors, which would give them a better stance in the economy. The main idea of diversification is to channel almost equal energy or resources to every area that looks promising.
Photo by Towfiqu barbhuiya On Unsplash
In a proper sense, it is advisable never to put all eggs in one basket, which also applies to investment. The idea of investing in only one project can sometimes cost us, maybe due to the negative outcome of that project.
Though some people might not agree with the idea of diversification, because they feel that it is better to channel all energy and resources to a single project, but the big question comes in when that single project fails to meet ones expectation.
Why Diversify ?
When we check out for the meaning of diversify, so many results might come up due to how complex the word might seem. But from my own definition, diversify simply means extending a work force to other necessary areas inorder to achieve better success. Now it doesn't sound difficult right ?.
Diversification of investment has being a major secret of so many people today, as they always find themselves attracted to making investment in different projects that looks promising. This then leads to the question WHY ?.
A major reason why investors diversify their investment is to build a good financial portfolio from different sectors or organizations. By building different portfolios, it enhances them to work harder by keeping track and taking serious note of any changes in their current investment.
Another interesting importance of diversification is that it helps investors by acting as backup, especially in certain periods when a particular projects fails and result to loss of funds. Other project can easily act as necessary backup for the failed project.
So in conclusion to this, diversification helps in situation of failed projects, and also helps us to grow good financial portfolio inorder to keep us active in maintaining a sustainable growth in all.
Photo by Kostiantyn Li On Unsplash
Building Financial Portfolio
Aside investment, humans are always eager to gather as much as they can, because they believe that the raining days awaits them. This is practically same in the world of investment, as both large and small scale investors try to build a good financial portfolio for themselves.
The process of building a good financial portfolio must come with diversification due to uncertain outcomes that might occur in the later days.
Building financial portfolio doesn't require much from a investor, as this procedure requires diligence, patience and hard work to attain a fare height. In the case of investors, some hive users have being building their portfolios long time back, and they are currently leading a top spot at this point in time.
It's quite disheartening to see some people who believe so much in investment, but don't consider building a financial portfolio. This two concept sounds almost alike, but are completely different.
In investment, it involves the staking of invaluable item for a long or short period of time, with the expectation of getting a reward. After the given period of time, some investors might decide to spend all the profits that have come over time.
But for building financial portfolio, it requires the continious growing of wealth without any intentions of spending it. This portfolios are sometimes even use as investment.
Photo by Felix Mittermeier On Unsplash
Checkmating
I have being able to spot the reasons for diversification, but it is also important to checkmate this process during investment. Checkmating simply puts us in an aligned position, preventing us from being harmed. Checkmating our diversified investment prevents us from slagging in other areas of investment.
In the process of building different financial portfolios, spotting out losses can be very difficult most especially when we deal with large form of investment. This sometimes requires extra hand by employing a third party to give assistance, or it requires extra work from the investor.
When it comes to the crypto market, regular Checkmating of investment is always necessary due to the volatile nature of this digital assets. The price of this coins change regularly, and sometimes might be affected by human influence.
Failure to checkmate our diversified investment can lead to a great loss. I guess this must be the reason why some people are against it.
My Opinion And Conclusion
The idea of diversification is to encourage investment in different categories, thereby aiding us to build different financial portfolios and dominating the available space in every financial sector. Diversification comes with a lot of responsibilities inorder not to end up in a bad side of investment.
This post basically explains importance of diversification of investment inorder to build a good financial portfolio.
I am not a financial advisor, any decision taken by anybody after reading this post, is literally at his or her own risk. Let's be cautioned.
Here Are Some Of My Post Below...
Bitcoin: How Magical Is This Magic Money ?
Cryptocurrency: Correcting The Already Failed System Of Financial Institutions
Concept Of Time Investment And Consequences Of Negligence.
Thanks for reading my post, please do well to rehive and follow me for more.
Posted Using LeoFinance Alpha
Congratulations @sahidclement99! You have completed the following achievement on the Hive blockchain And have been rewarded with New badge(s)
Your next target is to reach 1750 upvotes.
You can view your badges on your board and compare yourself to others in the Ranking
If you no longer want to receive notifications, reply to this comment with the word
STOPCheck out our last posts: