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Portfolio diversification. a) Reduces the effect of high returns of high-earnings stocks. b) Reduces the effect of low returns on low-earnings stocks. c) Reduces systematic

Portfolio diversification.

a) Reduces the effect of high returns of high-earnings stocks.

b) Reduces the effect of low returns on low-earnings stocks.

c) Reduces systematic risk.

d) None of the above.

e) a. and b.

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