The idea is not to put money in something you don’t understand. People who are not keen about making more money can split up their money. And when they do, it is with the intention of not losing the money, not to make more. It may seem smart to some super-rich people, but I know of people who are just coming up who have lost fortunes because of it.
For example, there was a lady who made money from the dot com boom and lost everything in the stockmarket. She didn’t understand stocks. But the experts told her to diversify.
Diversification is playing not to lose. It isn’t playing to win. People do it because they are afraid of losing. Several rich people diversify because they are playing not to lose. But some do not, because they play to win.
Dan Peña says diversification has lost him more money than anything. Robert Kiyosaki sticks with the real estate he understands. That is the big idea.