What is Diversification?

The practice of spreading investments across different assets to reduce overall risk.

In-Depth Explanation

By holding assets that are not perfectly correlated, a trader can reduce the impact of any single asset's poor performance on the total portfolio.

"Instead of only trading Tech stocks, the investor adds Gold and Commodities for diversification."

Knowing the terms is just the start. Learning how to apply them is where the edge is found.