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Portfolio Diversification

Keeping a diverse portfolio is critical to becoming a great investor. You don't want to put all of your eggs in one basket, but at the same time you don't want to spread out your money too thin. Luckily, TradeMaid knows the perfect balance between too much and too little diversification. The two stocks with the most money invested in them should never exceed a combined 30% of an investor's portfolio. On the flip side, the two stocks with the most money invested should take up at least a combined 10% of an investor's portfolio. The list below is a depiction of how to properly diversify your wealth based on the size of your portfolio.

  1. Account size $1-$1,000: Portfolio should have around 2-5 different stocks

  2. Account size $1,000-$5,000: Portfolio should have around 3-6 different stocks

  3. Account size $5,000-$10,000: Portfolio should have around 5-7 different stocks

  4. Account size $10,000-$20,000: Portfolio should have around 6-9 different stocks​

  5. Account size $20,000-$50,000: Portfolio should have around 7-10 different stocks

  6. Account size $50,000-$100,000: Portfolio should have around 10-12 different stocks

  7. Account size $100,000+: Portfolio should have at least 12 stocks​​