Diversification – the only free lunch in investment
The above chart shows the “ups and downs” of different assets classes between 2005 – 2018. Also included is an “equally weighted” or diversified portfolio (the white one) which is an equal blend of the twelve asset classes. The diversified portfolio is never in the top three but also never in the bottom four of returns. At TKV we use quality risk profiling tools to design diversified portfolios to meet the specific needs of our investors. Our focus is to help our clients reduce the downside risk of a “non-diversified” portfolio.
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