How to diversify my investments in the Stock Market?

Diversifying means not putting all your money in the same place. The goal is to reduce risk so that poor performance of one investment does not affect your entire portfolio.

Diversification can be done in several ways:

1- Diversify by companies - Instead of buying shares of just one company, spread the investment across several;

2- Diversify by sectors - Invest in various sectors (Technology, Health, Energy, Consumer, etc.). If one sector faces difficulties, others may compensate.

3- Diversify by geographies - You can invest in various markets (USA, Europe, Japan, Emerging Markets).

Global ETFs do this automatically, investing in companies from several countries.

4- Diversify by asset types - You don’t need to invest all your capital in shares (for example, in ETFs, Bonds, and Savings or liquidity products).

In your choice, you should consider your age, objectives, time horizon, and risk tolerance.

The easiest way to diversify is to invest in a global ETF that provides exposure to several companies from various countries and sectors.

Golden rule: never invest all your money in a single share, sector, or country. The more diversified the portfolio, the lower the specific risk of each investment tends to be.