Market risk can be eliminated in a stock portfolio through diversification.

Question

Quizplus · Accepted Answer

Market risk refers to the risk that the entire market, or a major segment of it, will have a downturn that negatively affects the value of a portfolio. While diversification can help mitigate some types of risk, it cannot completely eliminate market risk. This is because all stocks are subject to some level of market risk, as they are influenced by the overall market conditions and economic trends.

Market Risk Can Be Eliminated in a Stock Portfolio Through