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Currency diversification |
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Currency diversificationUsing more than one currency as an investing or financing strategy. Exposure to a diversified currency portfolio typically entails less exchange rate risk than if all the portfolio exposure were in a single foreign currency.Currency diversification Similar MatchesDiversificationDiversificationDividing investment funds among a variety of securities with different risk, reward, and correlation statistics so as to minimize unsystematic risk. Sector diversificationSector diversificationConstituting of a portfolio of stocks of companies in each major industry group. Unique Diversification BenefitUnique Diversification BenefitReduction in the likelihood of financial distress for a conglomerate firm that comes with its diversified investments. Naive diversificationNaive diversificationA strategy whereby an investor simply invests in a number of different assets in the hope that the variance of the expected return on the portfolio is lowered. In contrast, mathematical programming can be used to select the best possible investment weights. Related: Markowitz diversification. Diversification coneDiversification coneFor given prices in the Heckscher-Ohlin Model, a set of factor endowment combinations that are consistent with producing the same set of goods and having the same factor prices. Such a set has the form of a cone. Further SuggestionsdiversificationInternational diversification Efficient diversification Principle of diversification Markowitz diversification Liquidity diversification Cone of diversification Indirect diversification benefits |
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