Since then, it has gone through a series of sharp ups and downs, closing down 804 points the week ending April 14. And it can be unnerving. Give Diversification a Chance to Succeed Diversification is essential to investment success. In a well-diversified portfolio, some of your holdings will be going up, while at the same time others may be going down. This may not lead to sustained periods of tremendous growth, but, over time, you will be protected from downturns that affect just one area, and you'll give yourself a wider range of opportunities for success.
Different sectors go through periods of ups and downs.
For example, the current market environment has been difficult in general for financial services, retailers, health care companies and consumer goods. Today's long-term outlook for these sectors remains attractive. It sounds simple, but too many people ignore this basic axiom of investing. Try to find those companies whose management is strong and whose products are well-positioned for the future. Right now, it's technology.