diversification
2 antonyms and opposites of diversification, grouped by meaning.
Noun — The practice of spreading money across a number of different investments, industries, asset types or countries, so that the fortunes of the whole holding depend less on any single one of them.
Synonyms by Meaning
1. noun finance
The practice of spreading money across a number of different investments, industries, asset types or countries, so that the fortunes of the whole holding depend less on any single one of them.
“The portfolio has almost no diversification: nine of its ten holdings are technology shares.”
Opposites
2. noun business
More generally, the act of expanding into new products, markets or activities rather than relying on one.
“Diversification into ready meals kept the bakery going through a poor summer.”
Opposites
Antonyms
How to use diversification
The word patterns that sound natural to a native speaker.
Standard in finance and business writing; the everyday equivalent is the proverb about not putting all your eggs in one basket.
Etymology
From diversify, from Latin diversus meaning turned different ways, plus the noun ending -ation.
Full origin of diversification →Frequently asked questions
What is the difference between diversification and asset allocation?
Asset allocation is the decision about how much goes into each broad category — shares, bonds, cash, property. Diversification is about spreading holdings within and across those categories so that no single company, sector or region dominates. The two overlap, and asset allocation is one of the ways diversification is achieved.
Does diversification remove risk?
No. It reduces exposure to events affecting one company or sector, but it cannot remove risks that move whole markets at once, such as a broad downturn. That market-wide element is sometimes called systematic risk, and it remains however widely holdings are spread.
Can a portfolio be too diversified?
Some argue it can. Beyond a certain point, adding more holdings does little to reduce the effect of any one of them, while adding cost and complexity. This is sometimes described with the coined term diworsification.