Remember the adage, “Don’t put all your eggs in one basket”? This old saying certainly holds when making investing decisions; in fact, diversification—both between asset classes and within individual asset classes—ranks among the most powerful tools in your arsenal when it comes to reducing avoidable risk. As I’ve talked about before in this column, diversification is critical for any type of investing, in particular alternative investing. Equity crowdfunding is simply a mechanism to facilitate investments into private companies.
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