Based on the historic evidence, which of the following is the most supported reason for adding gold to a portfolio of U.S. stocks?
A) To increase the portfolio's expected return.
B) To reduce the portfolio's risk.
C) To increase the portfolio's expected return and reduce its risk.
D) To increase the portfolio's expected return and maintain its risk.

Question

Quizplus · Accepted Answer

Gold is often added to a portfolio to reduce risk because it typically has a low correlation with U.S. stocks, providing diversification benefits and acting as a hedge against market volatility.

Based on the Historic Evidence, Which of the Following Is