a portfolio is a collection of financial investments like stocks bonds commodities cash and cash equivalents including closed end funds and exchange traded funds etfs 
people generally believe that stocks bonds and cash comprise the core of a portfolio though this is often the case it does not need to be the rule a portfolio may contain a wide range of assets including real estate art and private investments you may choose to hold and manage your portfolio yourself or you may allow a money manager financial advisor or another finance professional to manage your portfolio understanding financial portfoliosone of the key concepts in portfolio management is the wisdom of diversification which simply means not putting all of your eggs in one basket 1 diversification tries to reduce risk by allocating investments among various financial instruments industries and other categories it aims to maximize returns by investing in different areas that would each react differently to the same event there are many ways to diversify 