Asset Diversification says that within each of the asset allocation pyramid levels, you should diversify your holdings so that each level has no more than 5 to 10% of your toal porfolio in any one investment.

Even after losing 20%, getting no return on 20%, and making only 5% on 20% of the original investment, the diversified investments still outperform the undiversified investment by 40%!
For illustration only. Does not reflect actual performance of any specific invesetment, any charges, fees, or taxes.
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