HomeDefinitionsCompareDebt Naive diversificationThe financial definition for Naive diversification:A 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. Similar MatchesCurrency diversificationCurrency 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. DiversificationDiversificationDividing investment funds among a variety of securities with different risk, reward, and correlation statistics so as to minimize unsystematic risk. Efficient diversificationEfficient diversificationThe organizing principle of modern portfolio theory, which maintains that any risk-averse investor will search for the highest expected return for any particular level of portfolio risk. Further SuggestionsIndirect diversification benefitsInternational diversification Liquidity diversification Markowitz diversification Principle of diversification Sector diversification Unique Diversification Benefit Click to compare definitions of Naive diversification Click to view definitions beginning na |