an investor buys enough stocks, he or she can, through diversification, eliminate all of the market risk inherent in owning stocks, but as a general rule it will not be possible to eliminate all diversifiable risk.

Question

Quizplus · Accepted Answer

Diversification can eliminate diversifiable risk (unsystematic risk), but it cannot eliminate market risk (systematic risk), which affects all stocks.

An Investor Buys Enough Stocks, He or She Can, Through