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1.5.1 Risk and Return

One could say that pricing and the fluctuation of shares is a result of supply and demand. A share can be 20% more expensive in just one day without any change of its fundamentals. However, there are several models to define the theoretical value of a share.

Do not invest all your wealth in one individual share or sector.

As a general rule your age should be the % of fixed income in your portfolio, if you are 50 years old you should invest a maximum of 50% in shares.

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