Question: Which statement about portfolio diversification is correct? A. Proper diversification can eliminate systematic risk. B. The risk-reducing benefits of diversification do not occur meaningfully until

Which statement about portfolio diversification is correct?

A. Proper diversification can eliminate systematic risk.

B. The risk-reducing benefits of diversification do not occur meaningfully until at least 50-60 individual securities have been purchased.

C. Because diversification reduces a portfolio's total risk, it necessarily reduces the portfolio's expected return.

D. Typically, as more securities are added to a portfolio, total risk would be expected to decrease at a decreasing rate.

E. None of the statements are correct.

Is this correct?

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