provide peer review/response to the below discussion:

Every investment comes with a risk no matter how small but diversifying your portfolio can help with this. Instead of having all your money in one place, spreading it out will protect you. Although diversification can't reduce all risk, it will reduce asset specific risks. For example, if you invest 100% of your portfolio into Amazon, then the market drops 10%, you will lose an entire year's worth of growth overnight. (Yoshida, 2022). Spreading out your portfolio will reduce this feat, because assets are not all in a similar/same field and profit loss will not be as large. One research article demonstrated that not only diverse in field but diversity in region is beneficial. After completing research Global index portfolios, it was found that investors are attracted because it brings a financial security not found in single equity-based portfolios that are domestic (Hernandez et. al, 2020).

Many people refrain from creating diverse portfolios, as they fear having to monitor too many areas. The misconception believed is putting your eggs into many different baskets will make them unsafe but with the simplicity of a plain portfolio an individual investor would miss out or simply suffer a greater risk of total loss (Yoshida, 2022). This was demonstrated by Frisberg, 2021 who completed a study that took a portfolio of 20 products that were all Sweedish alcoholic beverages. After examining profiles of wholesalers and testing hypothetical changes including domestic beverages and low viability products they were able to see how high or low the risk and return profiles were affected. The conclusion was two part:

• The higher the number of products the lower the standard deviation which mean lower risk.
• The concentration of imports had a minor affect related to the number of products.

For me investing is just not easy and this is likely due to my lack of investing. I believe this class has given me a teaspoon of knowledge but I assume diving in for a personal experience would do more. Either way new or experienced investors need to have a fallback plan

References Friberg, R. (2021). All the bottles in one basket? Evaluating the effect of intra-industry diversification on risk.Long Range Planning,54(1), N.PAG. https://doi.org/10.1016/j.lrp.2020.101973

Henry Yoshida, C. (2022, September 26). Council post: Understanding the importance of investment diversification. Forbes. http://www.forbes.com/sites/forbesfinancecouncil/2022/09/23/understanding-the-importance-of-investment-diversification/?sh=101ae7e16a88.

Hernandez, J. A., & Al Janabi, M. A. M. (2020). Forecasting of dependence, market, and investment risks of a global index portfolio.Journal of Forecasting,39(3), 512-532. https://doi.org/10.1002/for.2641