Invest Across Asset Classes

Diversify your portfolio across different asset classes like stocks, bonds, real estate, commodities, and cash. Each asset class has its own risk and return characteristics, and they often perform differently under various market conditions. This can help smooth out your portfolio’s performance over time, as losses in one asset class may be offset by gains in another.

Diversify Within Asset Classes

Diversification doesn’t stop at investing in different asset classes. Within each asset class, ensure you spread your investments. For instance, if you’re investing in stocks, don’t just invest in one sector or company. Spread your investments across different sectors and companies. This can help reduce the impact of any single stock or sector performing poorly.