The Importance of Diversification in Investment PortfoliosDiversification is a fundamental investment strategy that plays an essential role in constructing a resilient and successful investment portfolio. By spreading investments across various asset classes, sectors, and geographies, diversification helps mitigate risk and enhance potential returns. Understanding and implementing diversification is key for investors looking to balance risk with reward.Understanding DiversificationAt its core, diversification is about spreading risk. In investing, it involves holding a variety of investments, so the exposure to any single asset is limited. This approach reduces the impact that the performance of any one investment can have on the overall portfolio.Benefits of DiversificationRisk Reduction:...