Should I Use Different Investment Companies To Make Sure My Portfolio is Diversified?


Welcome to Ask Clark, a column designed to answer your financial questions, by money expert Clark Howard.

How Many Companies Should I Invest With?

Jim in South Dakota asks: “I understand the importance of diversifying investments. Is it wiser to also invest using more than one company? If yes, what is an advisable number? Two to three or more?”

Clark’s Take on How Many Investment Companies You Need

Clark says: “There is no reason I’m aware of for it to be necessary for you to diversify what company you invest with.”

If you’re looking for a reputable firm, Fidelity, Schwab or Vanguard are all on Team Clark’s list of best investment companies. No matter which investment firm you choose of those three, Clark says you’ll be in good hands.

“The investments that you go into are protected by their very nature if you’re in index funds or mutual funds,” Clark says. “You don’t have to worry about those all being in one company. Keeping things simple in this case, I think, is just fine.”

If you prefer automated financial advice, take a look at these robo-advisors.

To hear Clark’s full take on this question, listen to the segment:

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