Rule 7: Diversify in stocks and bonds, as in much else, there is safety in numbers
No matter how careful you are, you can neither predict nor control the future. A hurricane or earthquake, a strike at a supplier, an unexpected technological advance by a competitor, or a government-ordered product recall—any one of these can cost a company millions of dollars. Then, too, what looked like such a well-managed company may turn out to have serious internal problems that weren’t apparent when you bought the stock.
So you diversify—by industry, by risk, and by country. For example, if you search worldwide, you will find more bargains—and possibly better bargains—than in any single nation.
Earlier on Tradingwisdoms