Ray Dalio and Warren Buffett are two wealthy and very famous investors who have different views...

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Ray Dalio and Warren Buffett are two wealthy and very famousinvestors who have different views on diversification.
1. Explain both their ideas on diversification.
2. Which side do you agree with? Why?
Initial Post Length: minimum of 500 words.

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Ray Dalio and Warren Buffetts Views on Diversification 1 Warren Buffetts views on Diversification Billionaire investor Warren Buffett famously stated that diversification is protection against ignorance It makes little sense if you know what you are doing In Buffets view studying one or two industries in great depth learning their ins and outs and using that knowledge to profit on those industries is more lucrative than spreading a portfolio across a broad array of sectors so that gains from certain sectors offset losses from others The need for diversification is a portfolio theory rooted in the idea that an investor who puts all his or her money in one company or one industry is flirting with disaster if that company or industry takes a dive Pros and Cons of Diversification These traders further diversify by selecting mutual funds and ETFs from different sectors that follow different trends Some follow the ups and downs of the broader market while others remain relatively flat Still others move inversely with the broader market experiencing ups when most sectors are down and vice versa The idea behind this strategy is that no matter what the market is doing a portion of the investors portfolio is likely to do well The problem with See Answer

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