advantage of diversification

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November 10, 2016 at 5:20 am #348277
Vipin
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kaplan text says that the advantages of diversification

increased flexibility
better access to capital markets

it actually lists 6 of them but I don’t understand the above 2 points.
how it increases flexibility?
how it enables better access to capital markets?

thanks
November 10, 2016 at 7:43 am #348290
Ken Garrett
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Not sure about flexibility – except that the company might have more products.

Capital markets might view the risk in the group as being diversified so will reduce the cost of finance.
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