An investment strategy to limit risk by diversifying around a variety of investment instruments. In banking, this can be accomplished by ensuring that assets in a portfolio are not limited to a specific geographic region, industry or customer.

Diversifying a portfolio by investing in various types of asset classes, securities and industries.

spreading the collection of assets owned in order to limit exposure to risk.

The strategy of investing in different asset classes and among the securities of many issuers in an attempt to lower overall investment risk and to avoid the chance that a portfolio's performance would be hurt by the poor performance of a single security, industry, or country.

Choosing alternative investment instruments having different risk-return features. Diversification provides a lower but acceptable overall return.