Question: Select the TRUE statement regarding diversification a) Unsystematic risk of a portfolio cannot be reduced through diversification c) Diversification works best when the returns of

Select the TRUE statement regarding diversification

a) Unsystematic risk of a portfolio cannot be reduced through diversification

c) Diversification works best when the returns of the assets are highly, positively correlated

b) Diversification only reduces systematic risk

d) Diversification acts to reduce risk if the returns of assets are not perfectly correlated

e) A well-diversified portfolio of stocks can completely eliminate risk

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