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Who else wants to diversify their portfolio?

I’m always on the lookout for ways to diversify my portfolio whilst maintaining strong returns. If you can mitigate risk whilst also beating the market then that’s a powerful combination.

Diversification usually means investing into different industries and perhaps businesses that offer geographical diversification away from Australia.

Here are three shares that I think would offer good diversification:

BetaShares Global Agriculture ETF (ASX: FOOD)

This exchange-traded fund (ETF) is offered by ETF specialist BetaShares. Food is an essential part of our lives, so you could say it’s defensive in some regards.

The ETF gives investors exposure to some of the world’s biggest food businesses like Archer Daniels Midland, Deere & Co, Kubota Corp and Tyson Foods.

The importance of food companies is only going to increase as the global population. Some experts believe there will be a good shortage by 2030. If that’s true then this ETF could be one of the best ways to profit from that idea.

National Veterinary Care Ltd (ASX: NVL)

This veterinary clinic business has seen its share price fall by over 30% since its all-time high at the start of the year due to difficult conditions in the vet industry.

However, I think this presents a compelling long-term opportunity to buy shares at a discounted price. We all still own pets – the number of pets hasn’t decreased by 30%. Pet owners still regularly take their pet to the vet, a majority of pets go at least once a year.

National Vet Care has acquired a lot of new clinics over the past year. It needs to integrate them. I think the amount of annualised profit that will be realised in the FY19 result will encourage investors with this pet company again.

Magellan Global Trust (ASX: MGG)

This is a listed investment trust (LIT) run by Magellan Financial Group Ltd (ASX: MFG). It aims to give Aussie investors exposure to some of the world’s highest-quality businesses like Facebook, Alphabet (Google), Visa, Mastercard and Wells Fargo.

Since inception in October 2017 it has outperformed its benchmark by 0.6%, after all fees, whilst keeping a good amount of cash on hand for downside protection. At June 2018, 21% of its portfolio was cash.

I think this is one of the better ways for investors to get exposure to high quality international shares without having to do any research themselves.

Foolish takeaway

At the current prices I’m drawn to National Vet Care’s beaten-down share price. Although 2018 has been disappointing for the pet company you just need to think about where the business will be in five or ten years’ time. In that context, I think it’s easier to imagine how much more valuable the National Vet Care will be.

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Motley Fool contributor Tristan Harrison owns shares of MAGLOBTRST UNITS and NATVETCARE FPO. The Motley Fool Australia owns shares of NATVETCARE FPO. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.