The strategy of investing in several assets so that any possible losses are independent events is:
A)diversification.
B)private information.
C)moral hazard.
D)adverse selection.

Question

Quizplus · Accepted Answer

Diversification is the strategy of investing in several assets so that any losses in one asset are not correlated with losses in other assets. By doing so, the investor can minimize their overall risk and maximize their chances of making a profit. This is considered a fundamental principle of investing and is widely accepted as a way to manage risk. Private information, moral hazard, and adverse selection are all different concepts that are not related to the strategy of diversification.

The Strategy of Investing in Several Assets So That Any