1. A company’s movement into a broader range of products, usu. by buying firms already serving the market or by expanding existing operations (the soft-drink company’s diversification into the potato-chip market has increased its profits).
2. The act of investing in a wide range of companies to reduce the risk if one sector of the market suffers losses (the prudent investor’s diversification of the portfolio among 12 companies). — diversify, vb.
