Diversification is one of the fundamental principles in wealth management, helping to manage risk and optimize returns. By spreading investments across different asset classes, sectors, and geographies, you reduce the potential impact of a poor-performing investment on your overall portfolio. It’s important to have a mix of stocks, bonds, real estate, and other investment types to ensure that your portfolio can weather economic downturns and capitalize on market opportunities. The key is finding the right balance based on your goals, risk tolerance, and time horizon.