A version of this article previously appeared in the August 2019 issue of Morningstar ETFInvestor. Download a copy here.
Diversification is the only free lunch in investing. Spreading bets across securities, sectors, and geographies is an efficient way to reduce risk. But traditional means of measuring these dimensions of diversification have limitations.
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Ben Johnson does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.