CNBC’s Jim Cramer told investors Wednesday that diversification remains key to maintaining a successful portfolio.
“I can’t say that a diversified portfolio is bulletproof. But I can say that it’s easier to stay in the game when a particularly popular group is going through the meat grinder,” he said.
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The Nasdaq Composite and S&P 500 closed lower on Wednesday as investors digested recent corporate earnings. The Dow Jones Industrial Average edged up to end the trading session.
Tech stocks fell on concerns over Microsoft’s softer-than-expected guidance, extending Nasdaq’s losses for a second day.
The latest declines come after a solid start to the year for the tech-heavy index, as hopes that the US Federal Reserve might slow the pace of rate hikes prompted investors to return to growth stocks.
“Honestly, if you have too much tech exposure, on a day like today you can just say, that’s it, I’ve had enough, I’m getting out of this racquet. Well, that’s why you need to stay diversified,” Cramer said.
He added that even after the recent declines, he still doesn’t recommend investors to add to their tech positions. “I want to stay in the game. I don’t want to be blown away when the tech grim reaper strikes.”
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