Which of the following is not true about diversification Diversification can substantially reduce the variability of returns without an equivalent reduction in expected returns There is usually a minimum level of risk that cannot be diversified away due to systematic risks We must have a negative c...

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Which of the following is not true about diversification? Diversification can substantially reduce the variability of returns

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Which of the following is not true about diversification?

	Diversification can substantially reduce the variability of returns without an equivalent reduction in expected returns.
	There is usually a minimum level of risk that cannot be diversified away due to systematic risks.
	We must have a negative correlation between two stocks in a portfolio in order to have diversification effect.
	The less the correlation, the greater the diversification effect, the lower the portfolio risk compared with weighted risk of individual securities.
	None of the above

Posted Date: Jul 03, 2024 11:37 AM

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Which of the following is not true about diversification? Diversification can substantially reduce the variability of returns

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