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1) A risk-averse investor currently holds low-risk shares in one company only. In what circumstances would it be wise to split the fund by purchasing
1) A risk-averse investor currently holds low-risk shares in one company only. In what circumstances would it be wise to split the fund by purchasing shares in a high-risk and high-return share?
2) Why is the standard deviation on a portfolio usually not a weighted average of the standard deviations of the constituent securities?
3) How are the gains from diversification linked to correlation coefficients?
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