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What is Diversification? — Meaning, Definition & Example

Definition

Diversification is the investment strategy of spreading money across different asset classes, sectors, and geographies to reduce risk. The principle is 'don't put all eggs in one basket'. A diversified portfolio might include equity, debt, gold, and real estate.

💡 Real Example

Instead of putting ₹10 lakh only in bank FDs, diversify: ₹4L in equity mutual funds, ₹3L in FDs, ₹2L in gold, ₹1L in debt funds.

🇮🇳 Diversification in Hindi / हिंदी में

विविधीकरण — विविधीकरण जोखिम कम करने के लिए विभिन्न एसेट क्लास, सेक्टर और भूगोल में पैसा फैलाने की निवेश रणनीति है।

Diversification (Hinglish) — Diversification ek investment strategy hai jisme risk kam karne ke liye alag-alag asset classes mein paisa lagaya jaata hai — equity, debt, gold, real estate.

❓ Frequently Asked Questions

What is Diversification in simple words?
Diversification is the investment strategy of spreading money across different asset classes, sectors, and geographies to reduce risk. The principle is 'don't put all eggs in one basket'. A diversified portfolio might include equity, debt, gold, and real estate.
Can you give an example of Diversification?
Instead of putting ₹10 lakh only in bank FDs, diversify: ₹4L in equity mutual funds, ₹3L in FDs, ₹2L in gold, ₹1L in debt funds.
What is Diversification meaning in Hindi?
In Hindi, Diversification is called विविधीकरण. विविधीकरण जोखिम कम करने के लिए विभिन्न एसेट क्लास, सेक्टर और भूगोल में पैसा फैलाने की निवेश रणनीति है।