What makes investing so risky?
Investing will always be risky since nothing is guaranteed, but you can choose a combination of assets that makes investing less risky.
Diversification is a technique used to manage risk by adding different types of investments to a portfolio.
Diversification is not just creating a portfolio of ten stocks instead of two. To maximize the benefits of diversification, a portfolio should contain a mix of assets (bonds and stocks).
Within each asset class, there should be more than one type of security.
The choices should contain issuers who face different types of risk, or varying degrees of the same risk.
Combining the various securities will …read more

You may be wondering why I used poorly-drawn cows for this example.  Well, I stumbled upon this article from Farmers Weekly Interactive that talked about diversification among young entrepreneurial farmers:
“Successful diversification means diversification, not distraction. This can, at worst, seriously undermine the existing business.”
To pull this back to a standard business standpoint, diversification can collectively steer your business or it can negotiate turns.  Though the only difference between those two points is semantics, I think that “negotiating turns” involves more planning and communication.   If you pull like-minded people from the exact same background, you will always receive the same, …read more