If an investor wanted to reduce the risk of a levered stock in their portfolio, how could they go about doing so while still retaining shares in the company?
A) They could sell some of their shares and use the proceeds to buy the firm's bonds.
B) They could sell some of their bonds and use the proceeds to buy the firm's stock.
C) They could use borrowed funds to buy more of the firm's stock.
D) None of the options.
Correct Answer:
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