Diversification Matters

Years of market experience boil down to one word of wisdom: Diversify

After a lifetime spent in the financial markets, the former chief executive of Putnam Investments who also founded and sold two other asset management firms, has distilled the lessons he learned into a book, “Investment: A History.”

And his book, which will be published in February, will tout a bit of seemingly boring advice that he gives after spending almost 60 years investing: Diversify.

“The lessons of investment theory have shown that diversification is a powerful tool whose risk-adjusted benefits are practically free,” says former Putnam chief Norton Reamer.

The key, however, is to keep enough money in safe places so that you can ride out market panics without selling stocks, he adds.

Richard Schroeder, CFP®, Jan. 13, 2016

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