Diversification

When an beginning one in the stock market starts to invest, one of its first wills is to buy some actions. A bit of PETR4 (Petrobra’s), a bit of VALE5 (Valley of the River Candy) e, in the possible measure do, a bit of that it seems to be more or less good. This if calls diversification, or in said popular, to place its eggs in some different baskets. In this article I explain because this is a bad idea. Already the great bilionrio investor Warren Buffett said: ' ' Diversification is a protection against the ignorance, does not make no direction for that they know what fazer.' ' Buffett said this because it knows that to buy some actions in the attempt to diminish the risks he is bad therefore, at the same time where its risk probably will diminish, its profits will also diminish, leaving it thus, with neutral incomes for drawn out periods of time. If a company to declare insolvent, you will lose money with its action and this is horrible.

But if at the same time a company will have fantastic profits and if to become new queridinha of the stock market, its profits will be tied up to with the damages of the company whom it declared insolvent. Soon, you will not lose nothing when she could lose but also she will not gain nothing when she could earn. He is obvious that this is an extreme example, however the trend is that the potential of its investments is total diluted with the time. But then if to diversify is bad to profit sufficiently, the certainty is not to diversify nothing? This is another point in which the beginning investor if loses with frequency. To have only one action can be so harmful for you of what to have 50 actions at the same time.

In the truth, if this only action to give problems to you, as its money is all in it, its damages could be fatal and its economies? Of course they will turn dust. He is extremely dangerous to invest in an only action, the profit potential is enormous but the loss potential is total. of this form also of the one not to invest. solution for these problems is very simple, is in the half term. Not it possesss action excessively and nor of less. One remembers what the Buffett said, only diversifies if you do not have the minimum idea of as to invest in the stock exchange. If you do not want to study e, consequentemente, you do not want to take the action market the serious one to be able to enrich one day, you will protect you to the diversification of its ignorance. Perhaps you are not rich never but at least she will not have that to raise 1 finger for this. On the other hand, if you want to invest rationally, you prevent to possess many actions. He selects several (ones 20) and then, compares them ones with the others and is only with the actions of the companies with better beddings and potential greater of growth for the future. In the end, it is probable that you finish with in the maximum 6 actions of high quality, one of each different sector. Of this form, you he will not be investing very or little but yes, in the certain measure.