A portfolio manager wants to increase or maintain the returns of his clients while mitigating their risk. What would be an appropriate decision for the portfolio manager to achieve this goal?

1. Move all investments to the United States where companies are more stable.
2. Transfer all investments to stocks in the industry with the most growth.
3. Avoid risk by not choosing investments he deems to be risky.
4. Purchase stocks that are similar and positively correlated with one another.