Sean Kemery was a New York-based financial professional with a background in commodity, currency and derivative markets. As a wealth manager, Sean Kemery works closely with clients and employs financial strategies to help them build and protect their investment portfolio. He is also knowledgeable in portfolio management and diversification.
To manage investment related risk, it is important to diversify an investment portfolio across various asset classes. Two major asset classes are equity and fixed income. Creating a portfolio of diverse asset classes is not sufficient for avoiding investment risk. The investor or portfolio manager also must choose assets in a strategic manner. For instance, choosing two different asset classes that originate from one company may not contribute to the goal of asset class diversity. The reason is that both assets may follow the same financial trends. An example is a case of an investor who has owned a company's stock for 10 years. Over that time period, the investor also purchases bonds from the same company. These two purchases result in a case where both equity and fixed income assets are linked to a single company. This is not a prudent diversification strategy. If the company has financial difficulties, then the stocks and bonds that were purchased will depreciate, and the investor will incur a loss.
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AuthorAs a director and senior trader at Deutsche Bank AG in New York, Sean Kemery handles commodities trading and indexes. Archives
May 2020
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