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Fidelity Int'l study shows power of investment diversification

Return_on_investment_compasFidelity International research has shown how investors could be thousands of pounds better off through diversification.

Investing £13,000 across 13 principal asset classes over 15 years would have accumulated £38,221 – which can be £28,000 more than investing in a single asset class. 

Investing the whole lot on US equities would have produced the highest returns - £64,659 – but “not without some bumps along the way”, said Fidelity, including a fall of £15,000 at one point. Asia-Pacific and emerging market equities also fared well compared to the diversified portfolio.

Tom Stevenson, investment director for personal investing at Fidelity International, said: “While some individual asset classes may outdo a diversified portfolio, at least half of the time a spread of investments provides a better return.”

The period covered was July 22, 2005, to July 22, 2020.

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