We have all heard about the mantra - “Don’t put all your eggs into one basket.” This sounds like good and reasonable advice, especially when the stock market is fraught with uncertainty and you are a risk averse guy. But it is also an investment sin to spread yourself too thin.

Assuming we’re long anything at this point, what puts would we use as a hedge, and how many do we need? First, we have to figure out how our portfolio moves in relation to the market. We know that four out of five stocks move in the same direction as the market trend, but by how much? Two numbers can give us a pretty good idea: beta and R-squared...

Thankfully someone who was completely VOID of any stock market knowledge has given me an idea to pen a piece that I think is very important for those of you who are actually serious about becoming a professional active investor. There is really nothing I can say about the market today that would mean or change anything from two-days ago.

Diversify Or All Your Eggs In One Basket? Diversification is a rather simple concept that simply refers to the idea of “not putting all your eggs in one basket“. Many beginning investors are often tempted to buy a huge number of shares in a single stock.

The Pension Benefit Guaranty Corp. will diversify its portfolio. Investment in equities would jump to 45% and 10% of its portfolio would be set aside for alternative investments which would be split equally between real estate and private equity. Diversifying its mix of investments would significantly increase chances of erasing the $14 billion deficit within the next decade.