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Which of the Following Statements About Diversification Is/are Correct

Question 17

Multiple Choice

Which of the following statements about diversification is/are correct?
I. Diversification may be able to reduce the risk of a portfolio to less than the weighted average risk of the assets.
II.Diversification is always prudent and should be expanded to include new, unrelated products whenever possible.


A) I only
B) II only
C) Both I and II
D) Neither I nor II

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