How to diversify your portfolio for safe & steady returns?

The smart investor knows and swears by this, that to make profits and to stay as a long-term racehorse and succeed too in the investment market, one needs to diversify one’s investment portfolio. Not all investments have happy endings and a happily ever after, for the market is volatile, and something which was performing so well yesterday can come crashing down today – and you might lose it all if you have invested it in the same place.

Don’t keep your eggs in one basket – that old adage still holds true, in today’s times. The real baffling question is how to ensure, that you’re diversifying your portfolio for safe and steady returns? Well, knowing the how is what makes the difference between a successful investor and not so successful one! So, let’s get to the steps that will help you diversify your portfolio for returns that are steady, safe, and financially rewarding:

Upli Investment

1. Your portfolio should have different types of investments

Well – what we mean here is when you are investing, don’t just settle on one kind, like mutual investments, because if the stock market crashes, you might be at a chance of losing it all. So, diversify right from the start. Invest in government bonds – because they are reliable, invest in mutual funds – because they are rewarding, invest in index funds because they show only a certain type of investment that’s doing good index-wise or invest in newer emerging options like bitcoin because let’s face it, even a minuscule investment in bitcoin, no matter how risky, gets you great gains in the long run, doesn’t it?

2. Diversification within single investments is important as well

When you’re going for government bonds, don’t just buy one kind- look through your options, and settle for different ones, right! Don’t buy an insane amount of individual stock – always diversify, and you would have steadier returns that way. Dreams of getting rich in one day don’t work when it comes to investment – your effort has to be consistent and composed. Different stocks in the varied sector is what you should be investing in, and the metrics you should consider must have different elements in consideration like growth, capitalization, and mixed-income. And if we are talking about bonds, you should get different interest rates, maturity dates, and duration and credit qualities.

3. Keep rebalancing your portfolio

The process of diversifying your portfolio is a continuous one, so you have to stay up-to-the-date with the market, and you have to move around your assets wherever the money is, and investing in different elements with different risk factors and returns is going to do the trick. The effort however has to be consistent, to make a difference in the nature of your returns or your operations. If you don’t have the time, you can always have technology help you – these days, roboadvisors exist and some of them are just brilliant – they do better work than humans, and we’re not kidding. Their algorithms make smart investments and ensure you get the best returns, and there’s continuous work going on with your investments.

4. Varying risk is another point

Well, while choosing investments – consider some which have a high-risk factor, and others which are steady and have none, but will get you returns no matter how low, this ensures that you won’t lose out on your money – no matter what, and you will have substantial gains at any point in time, so a good idea here is to invest in foreign stocks – the stock market in your country is different from another – foreign stocks behave differently so while you’re making a loss with your domestic stocks, you might be making a profit there – changes in the market can affect stocks differently, so why not take advantage of it, and make some money in the process?

5. Trade but not traditional

Most traders are going out of their way, and investing in more non-conventional and newly emerging investments like cryptocurrency. Though they have been around for the last decade, or so, the huge returns they have brought about to the ones who did the magic trick of believing in its potential way back are attracting more and more customers to this frontier. Well, to start off with bitcoin trading in a market that’s already increasing and profitable, you need the right technique – and if you are a newbie, we do understand why you are reluctant but let us tell you: you don’t need to be because the right platform can make all the difference in ensuring you have the big win, as well as the small wins. Platforms like don’t treat bitcoin as a digital currency or forex investment – they treat it like digital gold – and that is one of the key secrets to why they let their subscribers make profits even in an extremely volatile market. Don’t believe us? Try today and you will see the difference.

After working 5 years as a Software Analyst in reputed MNC, Rebecca decided to settle down and work from home. Having an expertise in business & being a life motivator, she loves to share similar stuff on our website by the means of her articles.