Diversification - for many people this is almost a magic word means safe strategy at which they will be able to earn and leave without any negative signs. BUT is it so? Let's find it out.
If in brief, diversification in a financial plan and in HYIPs in particular, means that it is not necessary to keep all eggs in one basket. It has to be some or if more exact, the more the better. Any skilled or even absolutely inexperienced financier or economist will confirm this judgment. However HYIP world as you for certain already know, not always lives on general economic, psychological or any other laws (even physics sometimes here is powerless) and therefore it is necessary to learn about potential problems of diversification.
So, we will begin with obvious (or unevident) reasons where diversification is necessary and important. First of all, it is safety of your money. As well as for any sane investor, for you the main task has to stand in principle "at least not to lose". Sharply it concerns depositing money in various high-risk projects which can be closed literally at any time. In a case with HYIPs it happens, besides for obvious reasons, nobody will return you the money. Thus, scattering small sums in various projects with various profitability, you will be able not only to keep investments, but also, perhaps, even increase.
The second moment of diversification is that it helps you quickly trace affairs in this or that project and, respectively, quickly move your investments between them. Various TM and PAMM with low profitability are most suitable; however the same rule will fit to high profitable HYIPs. The main principles here - react at the proper time and transfer money. For example, you see that affairs of a certain project go wrong. No refcom or PO is lagging. Then you find the safest and profitable place and transfer your money there. In this case, existence of a contribution showed less noticeable problems in a project which it would not be visible from the party and helped to keep money.
These were main merits of diversification, but whether there are negative? Unfortunately yes; they also meet often.
Very many beginners who especially didn't have experience in online investment at all, consider that it is rather simple to choose randomly some projects and throw there a certain sum. And nearly 95% of such "investors", finally, lose everything. What's the reason? And the reason - in those HYIPs. As we already spoke, similar projects work under separate laws. And if a big company, with an authorized capital, multi-billion investments and profitability to 5% a month, is possible to analyse and predict an exit point, HYIPs are absolutely unpredictable systems which work depends on too many critical factors. Factors are various, beginning from individual will of administration and finishing with moods of investors. One of such factor is enough to ruin a HYIP with subsequent loss of money. Thus, wrong selection of projects, all your diversification will not play any role as you simply don't know an exit point or will not manage to react before closing.
What to do in that case? As well as always in HYIPs - analyze projects, estimate their riskiness, trace moods of investors at various forums and sites, consult on partners or friends in investment. By similar methods you will be able to sift out good projects, and at competent approach to an investment and exit from a project, chances that diversification will bring you a maximum benefit, will increase many times.