Don't put all of your eggs in one basket applied a lot to me in the stock game. One example of this was because I often bought a lot of shares from only one or two different companies. This meant that if that company's stock drops, all of my stock does too instead of only a few shares. This is very risky because all of your stock could drop very quickly. Something I did during the game that is a good example of this clue/proverb was when I bought 13 shares of silver and 8 shares of rail road near the end of the game. I relied to heavily on silver and it dropped, I lost a lot of money. One way to stop this is by balancing your investments over several companies so that if one drops, all is not lost.
Thursday, September 4, 2008
Don't Put All of your Eggs in One Basket
Don't put all of your eggs in one basket applied a lot to me in the stock game. One example of this was because I often bought a lot of shares from only one or two different companies. This meant that if that company's stock drops, all of my stock does too instead of only a few shares. This is very risky because all of your stock could drop very quickly. Something I did during the game that is a good example of this clue/proverb was when I bought 13 shares of silver and 8 shares of rail road near the end of the game. I relied to heavily on silver and it dropped, I lost a lot of money. One way to stop this is by balancing your investments over several companies so that if one drops, all is not lost.
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