What is a good diversified portfolio?

Most well-diversified portfolios are a mix of stocks, bonds, and cash. And you can achieve proper diversification with just 3–5 investments. Plus, that's how several billionaire investors recommend you invest. Below is a complete overview of how to balance risk and reward, a look at asset classes, and five examples of diversified portfolios.

How do I diversify my ETF portfolio?

If your plan is to have a portfolio made up solely of ETFs, make sure multiple asset classes are included to create diversification. As an example, you could start by focusing on three areas: Sector ETFs concentrate on specific fields, such as financials or healthcare. Choose ETFs from different sectors that are largely uncorrelated.

Should you invest in a diversified energy ETF?

Should inflation rear its head again, a globally diversified energy ETF like IXC stands to benefit. This ETF tracks the S&P Global 1200 Energy 4.5/22.5/45 Capped Index, which holds a fairly concentrated portfolio of 53 companies. The top holdings of this ETF include all five of the oil and gas "super-majors," also known as "Big Oil."