The best way to minimize risk is to diversify your investments across various investment products. If equities are your sole investments, it makes sense to diversify between different sectors and companies. In this way, loss incurred on some investments can be absorbed or compensated by gains made in others, keeping the overall return on investment positive. You can also diversify your investment by investing in open-end mutual funds managed under various unit trust schemes. While investing in mutual funds check the credit rating of the fund and instrument. Similarly, while investing in any security, check the credit rating of the concerned company, if available.
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