Share X and Share Y have the following returns with their respective

probabilities.

Share X Share Y

Return Probability Return Probability

$10\%0\mathrm{.}315\%0\mathrm{.}3$

$5\%0\mathrm{.}31\%0\mathrm{.}4$

$-4\%0\mathrm{.}4-10\%0\mathrm{.}3$ Discuss the risk that can be reduced through diversification with relevant

examples.