In reality,many stocks are influenced by the same conditions as the stock market overall,so diversification by investing only in stocks is limited.

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Quizplus · Accepted Answer

This is because stocks are often influenced by factors such as economic conditions, interest rates, and political events that affect the overall market. Therefore, investing in a diversified portfolio that includes other asset classes such as bonds, real estate, and commodities can provide better diversification and risk management.

In Reality,many Stocks Are Influenced by the Same Conditions as the Stock