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The principle of diversification tells us that: concentrating an investment in three companies all within the same industry will greatly reduce the systematic risk. spreading

The principle of diversification tells us that:

concentrating an investment in three companies all within the same industry will greatly reduce the systematic risk.

spreading an investment across many diverse assets will eliminate all of the systematic risk.

spreading an investment across many diverse assets will eliminate a fraction of the total risk.

spreading an investment across five diverse companies will not lower the total risk.

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