Investing and Diversification

How your money is invested among many different kinds of stocks, bonds, mutual funds and ETFs—also called “portfolio diversification”—plays a far greater role in generating the financial results you want than focusing on any individual security.

Effective portfolio diversification reduces the likelihood that a downturn in a few securities you own will dramatically impact the overall value of your portfolio.

But diversification is just one aspect of effective portfolio management. You also need to:

  • Choose an appropriate asset allocation strategy with an optimal mix of stocks, bonds and cash for each of your retirement, college savings, and taxable accounts
  • Monitor the performance of your mutual funds, as well as the fees they charge, to make sure they’re not taking a huge chunk of your hard-earned gains
  • Periodically rebalance your portfolio’s asset allocation to its target mix without taking a huge tax hit

Investors often struggle to figure all this out on their own. That’s why many turn to a fee-only, fiduciary investment advisor in the Wealthramp network to manage their portfolios.

Find Your Advisor Matches

Key questions about investing and portfolio diversification a financial advisor can answer

  • Do I need to adjust my current mix of stocks, bonds and cash in my retirement, college savings and taxable accounts (also called “asset allocation'') to achieve my investment goals?
  • Do I have too much money invested in a few stocks or funds?
  • I’ve been given company stock. Should I sell a portion of it now in case its price falls significantly at some point?
  • How do I rebalance my portfolio without taking a huge tax hit?
Portfolio Diversification Challenges

How a financial advisor in the Wealthramp network can address your portfolio diversification challenges

Serving as your financial advocate, your financial investment advisor in the Wealthramp network works directly for you. They will create a comprehensive plan that addresses all your current and future financial goals, along with helping you grow your wealth.

As a registered investment advisor, they can review your portfolio and recommend changes to achieve greater diversification and alignment with your investment objectives. They can:

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Recommend changes to the current asset allocation in your various investment accounts to realign them with your specific financial goals, timeframe and risk tolerance

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Offer advice for rebalancing your portfolio to its original mix of stocks, bonds and cash in a tax-efficient manner

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Suggest ways to lower investment expenses by replacing expensive funds with lower-cost index funds and ETFs

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Serve as your portfolio manager for some or all of your accounts, freeing you from the burden and risk of managing your own investments

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The biggest investing & diversification mistakes

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Overlooking your asset allocation over time as your financial objectives, timeframe and risk tolerance change

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Failing to achieve an appropriate level of portfolio diversification to smooth out market volatility

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Neglecting an optimal asset allocation strategy for each of your investment accounts

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Paying thousands of dollars in investment fees for poorly performing mutual funds when index funds and ETFs offer better returns at lower costs

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Making impulsive investment decisions that nearly always result in “buying high” and “selling low”

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Neglecting how the market is throwing your investment mix out of balance

Work with an expert to optimize your portfolio diversification

We won't sell your data. You decide which advisors to talk to. And you won't receive any pushy sales calls from Wealthramp.

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