diversification

American  

[dih-vur-suh-fi-key-shuhn, dahy-] / dɪˌvɜr sə fɪˈkeɪ ʃən, daɪ- /

noun

1. the act or process of diversifying; state of being diversified.

2. the act or practice of manufacturing a variety of products, investing in a variety of securities, selling a variety of merchandise, etc., so that a failure in or an economic slump affecting one of them will not be disastrous.

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diversification British  

/ daɪˌvɜːsɪfɪˈkeɪʃən /

noun

1. commerce the practice of varying products, operations, etc, in order to spread risk, expand, exploit spare capacity, etc

2. (in regional planning policies) the attempt to provide regions with an adequate variety of industries

3. the act of diversifying

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Other Word Forms

• nondiversification noun
• overdiversification noun

Etymology

Origin of diversification

First recorded in 1595–1605, diversification is from the Medieval Latin word dīversificātiōn- (stem of dīversificātiō ). See diversify, -fication

Explanation

Diversification is the opposite of sameness. Use diversification to describe the goal achieved by a store that started with deli sandwiches and now offers gourmet coffee, muffins, soups, and salads. If a group seeks diversification, it wants to attract people of different ages from various backgrounds. If your financial adviser tells you that your stock portfolio needs diversification, this means you need to have stocks from a variety of companies and different industries. In other words, things should be more diverse. Use that to remember how to pronounce the word: Say diverse, then add if-ick-a-shun.

Example Sentences

A play farm and café on their land earned more than farming itself, Jackson said, and she was now looking into more diversification projects.

From BBC • Apr. 21, 2026

“For them, my papers reinforce the desirability of broad diversification — narrow portfolios selected in the absence of such skill have a high likelihood of underperforming the market,” Bessembinder told MarketWatch.

From MarketWatch • Apr. 14, 2026

ETFs provide diversification across many companies, lower transaction costs, tax benefits and reduce risks due to geopolitics, volatility and currency fluctuations.

From The Wall Street Journal • Apr. 10, 2026

Supporters of the rule argue that alternative assets offer potential for increased long-term returns and broader investment diversification, positioning the change as expanding innovation and opportunity for American workers and retirees.

From Los Angeles Times • Apr. 10, 2026

In short, Polynesia furnishes us with a convincing example of environmentally related diversification of human societies in operation.

From "Guns, Germs, and Steel: The Fates of Human Societies" by Jared M. Diamond

Related Words

• diversity