Diversification refers to the
A)splitting of wealth into many assets.
B)difference between the liquidity of an asset and its risk.
C)difficulty of converting investments in common stocks into investments in bonds.
D)difficulty of selling common stocks in a weak market.

Question

Quizplus · Accepted Answer

Diversification involves spreading one's wealth across many different assets, such as stocks, bonds, and real estate, to reduce the overall risk of the portfolio. By investing in multiple assets, any losses in one area can be offset by gains in another, resulting in a more stable and balanced investment portfolio.

Diversification Refers to the