Question: Consider the statements below and choose the answer that is correct. Diversification guarantees that an investor will achieve higher returns when investing in the stock

Consider the statements below and choose the answer that is correct.
Diversification guarantees that an investor will achieve higher returns when investing in the stock
market.
Most (and maybe all) firm-specific risk can be erased if an investor holds a very large, well-
diversified portfolio of stocks.
Joan can eliminate all of the systematic risk in her portfolio if she holds a portfolio of 100 stocks
from all different industries.
The total risk of a portfolio can be erased if an investor holds a very large and well diversified
portfolio of stocks.
Consider the statements below and choose the answer that is correct.

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