House Prices

Safety comes from spreading it wide - Mary Holm

Q: There is an issue that your readers might consider when they try to diversify their portfolio.

Diversification is not related to the number of different shares that you have in your portfolio.

Having a portfolio of many real estate developers is not diversification, even if you have 20 different firms in your portfolio. Diversification depends on the relationshi

Monday, December 13th 2004

p between those shares (their correlation).

You can have a diversified portfolio by holding a biotech share, a computer software share and shares in a hedge fund. You have a risky portfolio but well diversified nonetheless.

A: You make a really good point that I should have made more clearly in recent columns. I think, though, that you overstate your case.

The more shares you hold, the more diversified you are - even if they are all in the same industry.

While economic, legislative and other factors affect all the companies in an industry, there are also many company-specific factors that affect a share price.

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Heartland Bank - Online 6.69
SBS FirstHome Combo 6.74
Wairarapa Building Society 6.95
Unity 6.99
Co-operative Bank - First Home Special 7.04
ICBC 7.05
China Construction Bank 7.09
BNZ - Classic 7.24
ASB Bank 7.24
ANZ Special 7.24
TSB Special 7.24
Unity First Home Buyer special 6.45
Heartland Bank - Online 6.45
TSB Special 6.75
Westpac Special 6.75
China Construction Bank 6.75
ASB Bank 6.75
ICBC 6.75
AIA - Go Home Loans 6.75
Kiwibank Special 6.79
Co-operative Bank - Owner Occ 6.79
ANZ Special 6.79
ASB Bank 6.39
Westpac Special 6.39
AIA - Go Home Loans 6.39
China Construction Bank 6.40
ICBC 6.49
SBS Bank Special 6.55
Kiwibank Special 6.55
BNZ - Classic 6.55
Co-operative Bank - Owner Occ 6.55
TSB Special 6.59
Kainga Ora 6.99
SBS FirstHome Combo 6.19
AIA - Back My Build 6.19
ANZ Blueprint to Build 7.39
Credit Union Auckland 7.70
ICBC 7.85
Heartland Bank - Online 7.99
Pepper Money Essential 8.29
Co-operative Bank - Owner Occ 8.40
Co-operative Bank - Standard 8.40
First Credit Union Standard 8.50
Kiwibank 8.50

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