Diversification is one of the fundamental principles of investing. By spreading your investments across different asset classes—such as stocks, bonds, real estate, and cryptocurrencies—you reduce the overall risk in your portfolio. This is because different assets often perform differently under various market conditions.
In the volatile world of crypto, diversification is especially important. Holding only one coin exposes you to the full brunt of its volatility. But by including stablecoins, major coins like BTC and ETH, and even some DeFi or utility tokens, you increase your chances of steady returns over time.
A well-diversified portfolio can help manage risk, protect against loss, and improve long-term returns.
