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Which best describes the principle of diversification? A portfolio containing four companies all within the same sector will greatly reduce market risk. A portfolio containing
Which best describes the principle of diversification? A portfolio containing four companies all within the same sector will greatly reduce market risk. A portfolio containing two or three large stocks will eliminate all of the unsystematic risk. A portfolio containing five diverse companies will not lower total risk. A portfolio containing diverse assets will eliminate all of the systematic risk. Adding diverse assets to a portfolio will reduce some total risk
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