Making investments that have unrelated risks:
A)is the key to diversification.
B)is irrational.
C)increases the likelihood that a catastrophe will occur.
D)None of these are true.

Question

Quizplus · Accepted Answer

Diversification involves spreading investments across various assets to reduce risk. Investing in assets with unrelated risks is a fundamental strategy for achieving diversification, as it minimizes the impact of any single investment's poor performance on the overall portfolio.

Making Investments That Have Unrelated Risks