Smart investors on Main St. should remember one simple idea: Diversification.  Being diverse helps us withstand unforeseen events or movements that could potentially hurt our investments, but also allows us take advantage of good values.

One great example of this is Enron.  A lot of people had all of their money invested in Enron (retirement).  So when Enron fell apart…so did all of their investments.  Being diverse (owning lots of stocks in many areas) can help you avoid risks that occur from investing in one type of entity or investment.

No matter how you choose your investments (you are risk adverse or love risk) always remember…diversify.  People always say “Gee, if only I had put all my money in Google…I’d be a millionaire!”  For every “Google”, how many NOT-Googles have happened? A LOT!  So find those Googles, but never fully expose yourself.  That’s great advice in investing and wearing clothes.

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