A better diversification strategy to hold a core portfolio

[Cryptomultiplier]

 
‎Investors should look at the weapons, drones warfare and drug/medication industry first while  crypto currency and AI innovations industries come second as more profitable markets when considering investing or diversification of investment portfolio before even thinking of real estate or other investment options that may include precious metals.
‎
‎I don't mean to favor one sector over the others, but in order to create a balance when considering diversification of portfolio one may have to think outside the box of already known investment sectors like real estate and instead should allocate a larger portion of their funds to defense and the drug industries considering the endless wars and never ending need for medications, because they simply offer high certainty of revenue and perform consistently in the market, thus leading to stability, more income and protection against economic downturns and inflation.
‎
‎In a case where an investor considers the highest risk tolerance that offers the highest potential returns with the goal of maximizing long term capital growth, a significant portion of their portfolio should be diversified to the cryptocurrency and AI innovation industry instead.
‎
‎A great diversification approach to a stable dividend paying investment like the defense and drug industry mixed with AI and crypto currency especially Bitcoin is a perfect blend that ensures an investor holds a core portfolio that would really be profitable in the end.
‎
‎What do you think?
‎
‎

[Ambatman]

Good points and understand where you coming from but most of your adviced portfolios do well during crisis
What about a time when the world is facing peace.
Tbs it has never crossed my mind to try defence which I'm sure Aerospace would be fire this year
But I won't feel comfortable wishing the world should be at War so I would profit
Even if war is seeming human nature.
And precious metals especially Gold still remains Gold, this year's proved that.
So I guess I would be sticking with what I know but will check out the pharmaceutical.

[criptoevangelista]

An investor has to focus on markets that will always have demand. I can mention a few: medicine, beauty products, and the technology sector. All the others come with higher risks, especially when it comes to company assets. You never know if the numbers are real or fraudulent. There was a case here in Brazil involving a giant in the retail sector called Lojas Americanas. It practically went bankrupt and the financial hole was in the billions of dollars. The numbers shown to shareholders were all falsified.

[Alpha Marine]

You can't invest in something because it's profitable. You invest in what you're familiar with. There are many sectors and industries to invest in, so everybody can't invest in the same thing. I can't just decide to put money into the pharmaceutical industry when I have no idea about it. Invest in what yo know. If you feel like you need to invest in something then you have to first understand it. You can't only make informed decisions on what you understand. I won't even advise a person to invest in Bitcoin without having any understanding of how it works. How profitable a sector is isn't what should be the main thing, it's what you understand.

[coolcoinz]

Why diversify at all?

The thing is, you tell yourself that you should diversify to protect your investment from loss. At the same time wealth managers tell you to diversify because it gives them more to do which equals higher fees.
Bottom line is, those who don't know what's best for them will diversify to put their hands on a number of products in hope that at least one of them will bring high returns.
If you know what the best product is, there's no need to own anything else.

[Darker45]

I haven't thought of investing in a company that focuses on warfare. I quickly searched how the likes of Kratos Defense and AeroVironment's stocks are performing at least within the year, and I found out they're indeed doing good. However, many of their fellow defense-focused companies are not doing as great, some even facing drops in valuation.

I guess it all boils down to choosing the right company. Choosing a particular sector isn't the key.

[crwth]

Hmm. One thing to diversify into is Index Funds or ETFs. It provides more exposure to other industries and could help you benefit from different growth in different sectors as well. I think spreading in terms of how much money you can do is the best way to reduce risk as well.

Personally, what I like to do is Hedging and putting in stop-loss to balance my profits/losses. Sometimes do some rebalancing to have a good result.

[pooya87]

If you like investing in the stock market, then what you listed here are good sectors to look into these days. There can be good profit there. I personally don't like the stock market (I only owned one stock which I dumped recently after it appreciated 100% ) so I prefer other options like bitcoin, gold and real estate.

AI innovations industries

I think the AI sector became extra risky ever since China suddenly put DeepSeek on the table. That was a pivotal event that changed the nature of the global AI scene. It stopped being a simple competition and turned into all out war. We saw the crash in AI related stock at the time and then we saw the economic war between US and China (eg. restricting chip export to China versus restricting rare earth metals exports to US).

That creates a lot of complications in the sector and makes any investment in it, a lot riskier.

[yhiaali3]

Diversifying an investment portfolio is undoubtedly essential for mitigating risks and ensuring long-term asset growth. But I expect that sectors like weapons and drone warfare are not available in all countries and are not geared towards ordinary investors, but rather large, established investors.

Portfolio diversification depends on the situation in each country and the sectors that are considered promising in that country, but there are common assets for everyone such as Bitcoin, gold, precious metals, real estate and artificial intelligence.

[Jatiluhung]

The pharmaceutical sector is indeed quite promising. The same goes for the arms sector and similar sectors if the world is in a state of war or something similar. However, this also carries high risks. But if what is meant is only investments made online or through ETFs, then yes, it makes sense to include both in our portfolio assets. It's just that I personally don't hold many stocks at the moment. I have been gradually selling them off over the past few years and shifting them into the property sector, such as agricultural land and livestock, and a small portion into high-risk assets like Bitcoin.

The reason is that if the war escalates to the point where it could potentially disrupt the internet on Earth, we would be in serious trouble if all we hold are stocks that we can’t even check if the internet goes down. I prefer precious metals, property, and the rest in bitcoin. It doesn’t weigh on my mind at all.

[fruktik]

‎Investors should look at the weapons, drones warfare and drug/medication industry first while  crypto currency and AI innovations industries come second as more profitable markets when considering investing or diversification of investment portfolio before even thinking of real estate or other investment options that may include precious metals.

It's very strange that you're ignoring the food industry. It's worth remembering that food is a basic necessity for every person on the planet. Therefore, assets related to this industry should be a priority. No one wants to go to war on an empty stomach, let alone anything else. I initially favored what you wrote, but after some reflection, I've come to the conclusion that this is far from the case. Pay close attention to this. It might change your understanding of the world of investing.

[SamReomo]

What do you think?

Those who're into crypto often avoid other type of investments and want to remain in crypto industry only. Although, diversification does play an important role in getting something from each industry but crypto investors often stick to crypto and mostly to Bitcoin and for them thinking about investing in something else is just waste of time and money.

For me it makes sense to remain as a crypto investor as of this time but surely I do think about investing in real estate, gold, and stock exchange in future to get some better returns along with the what I get from Bitcoin and some other good alt coins.

[Aanuoluwatofunmi]

To go into diversifications, we must first ensures our assets are in bitcoin and some few other selected physically centralized assets, which may include gold, real estate, oil and any other profitable investment that could serve a backup purpose for us when our investment is yet to mature, having alternatives is very important to keep us abreast of the time challenges and increases our position to benefit from the assets.

[noorman0]

Investing a portion of your portfolio in defensive sectors (medical, and perhaps the defense industries) can be a conservative stabce, while still conducting regular due diligence; we shouldn't assume that defensive sectors are always safe.

-snip-
and AI innovation industry instead. ‎

Because they haven't proven themselves as long-term categories, they've so far been driven solely by hype. Perhaps I'd add a small portion as a high-risk investment. It's not that I don't believe in their innovations, but the competition and internal conflicts since the debut of Open AI and Deepseek don't feel very healthy.

[DubemIfedigbo001]

These are really good points you've mentioned, but in my own case, I would go for agriculture in place of weapons. People would always eat and be on the search for edibles and raw materials whether in times of war and in times of peace. In agriculture, demand always supersedes supply, and agricultural products are always in demand.

As a second option, I am already into bitcoin and as third, I would go into real estates and not gold. Having a properties in rapidly developing areas pays good dividends and I'm very keen on exploring that niche.

[Wiwo]

Here in my country diversification can only comein one phase like real estate and stock that is the only growing sectors here, although drugs and weapons is a high scale local illegal business.

Drone development is cool but requires alot of technical development which is something that is lacking and on a minimal scale here in my country.

So diversification for us here is through real estate as most primarily and cryptocurrency as core center of the investment targets of the 19-20 million cryptocurrency community members of Nigeria.

[Spaceman1000$]

‎Investors should look at the weapons, drones warfare and drug/medication industry first while  crypto currency and AI innovations industries come second as more profitable markets when considering investing or diversification of investment portfolio before even thinking of real estate or other investment options that may include precious metals.
‎
‎I don't mean to favor one sector over the others, but in order to create a balance when considering diversification of portfolio one may have to think outside the box of already known investment sectors like real estate and instead should allocate a larger portion of their funds to defense and the drug industries considering the endless wars and never ending need for medications, because they simply offer high certainty of revenue and perform consistently in the market, thus leading to stability, more income and protection against economic downturns and inflation.
‎
‎In a case where an investor considers the highest risk tolerance that offers the highest potential returns with the goal of maximizing long term capital growth, a significant portion of their portfolio should be diversified to the cryptocurrency and AI innovation industry instead.
‎
‎A great diversification approach to a stable dividend paying investment like the defense and drug industry mixed with AI and crypto currency especially Bitcoin is a perfect blend that ensures an investor holds a core portfolio that would really be profitable in the end.
‎
‎What do you think?
‎
‎

Weapons, drones, drug and medication industry are highly regulated by the government, it's not something you can just jump in without getting authorization from the government, you need serious scrutiny by the government for them to allow you begin to invest in this sectors, unlike the cryptocurrency that is deregulated and it's investors friendly. So it not as if people don't see the need to diversify into those sectors but when you begin to consider the rigorous processes those sectors needs before you can invest and you juxtapose it with the ease bitcoin investment brings to you, you just wouldn't know when you will just go for cryptocurrency investment instead.

[Disconnecting]

To go into diversifications, we must first ensures our assets are in bitcoin and some few other selected physically centralized assets, which may include gold, real estate, oil and any other profitable investment that could serve a backup purpose for us when our investment is yet to mature, having alternatives is very important to keep us abreast of the time challenges and increases our position to benefit from the assets.

I think the importance of diversification is clear in your statement but it should be looked at in a more balanced way because starting with just Bitcoin and some concentrated physical assets may not always be the best way because everyone's risk tolerance, financial goals and time horizon are different. Diversification is not just about creating alternatives but also diversification is about spreading risk and keeping the portfolio stable for the long term goal.

For example, some may feel comfortable building a foundation in more stable assets than Bitcoin and then gradually move into crypto or other higher risk assets. For this market conditions, personal cash flow, and even the regional economic environment also play a good role in here.

That's why the real power of diversification is creating the right balance between independent asset classes so that if one asset weakens then the other can repay. So it's more important than which asset to be in first, to create an effective, flexible and sustainable plan for yourself.

[Marvell1]

Why diversify at all?

The thing is, you tell yourself that you should diversify to protect your investment from loss. At the same time wealth managers tell you to diversify because it gives them more to do which equals higher fees.
Bottom line is, those who don't know what's best for them will diversify to put their hands on a number of products in hope that at least one of them will bring high returns.
If you know what the best product is, there's no need to own anything else.

Because the reality is that no asset is absolutely safe, and anything can happen. Just because an investment is considered the safest both in the past and now, doesn't mean it will likely remain that way in the future. There is no guarantee of that. Even if it is gold, an asset that has existed for thousands of years, there is no guarantee that it will be able to exist for thousands more. So Bitcoin or any other asset will be no exception. Risk is always lurking and anything can happen.

Diversification is a recommended strategy to minimize risk. However, it will all depend on each person's investment preferences and risk tolerance.

[aoluain]

I dont diversify, I focus . . . in Bitcoin

If I did want to diversify I definitely wouldnt want to do so into industry I dont agree with,
The weapons industry
Some food industries which wants to poison us
Some pharmaceutical companies who sell us drugs for food which poisons us

Michael Saylor on Diversification:

"Selling the winner to buy the loser"

"makes sense when you dont know the answer and you dont want to make a mistake"