Question: Which statement about portfolio diversification is correct? A. Proper diversification can reduce or eliminate systematic risk. B. Diversification reduces the portfolios expected return because it
Which statement about portfolio diversification is correct?
| A. | Proper diversification can reduce or eliminate systematic risk. | |
| B. | Diversification reduces the portfolios expected return because it reduces a portfolios total risk.
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| C. | As more securities are added to a portfolio, total risk typically would be expected to fall at a decreasing rate.
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| D. | The risk-reducing benefits of diversification do not occur meaningfully until at least 30 individual securities are included in the portfolio. |
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