Fred Smith is an experienced portfolio manager. Smith has many clients who want some risky assets in their portfolio, but do not want a high degree of risk. Smith would most likely tell clients that a portfolio of:

Low$-$risk assets will always be less risky than a portfolio of high$-$risk assets

High$-$risk assets can be less risky than a portfolio of risk$-$free assets

High$-$risk assets can be less risky than a portfolio of low$-$risk assets

High$-$risk assets will always be more risky than a portfolio of low$-$risk assets