You know the saying: “Do not put all your eggs in one basket.” The “eggs” represent your money and the “baskets” represent the different investments you get to choose from. In addition to stocks, bonds, and cash, which are the three major asset classes, there are sub-categories within each asset class that need to be managed. Some examples include sectors (financials, materials, energy, technology, health care, etc.), industries (the different categories inside of any given sector, like pharmaceutical and biotech are industries within the healthcare sector), company size (large cap, mid cap, and small cap) and the countries where they sell their goods and services. Incorporating all these within your investment portfolio is not an easy task but is still a necessity to mitigate undue risk in your portfolio.