diversification

diversification, n.

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.


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