A well-diversified portfolio has eliminated most of the:
A)expected return.
B)unsystematic risk.
C)systematic risk.
D)variance.
E)Both C and D.

Question

Quizplus · Accepted Answer

By diversifying a portfolio, an investor can eliminate unsystematic risk, also known as company-specific risk, as this type of risk can be mitigated through diversification. However, systematic risk, also known as market risk, cannot be eliminated and is inherent in the overall market. Therefore, choice B is the best answer as it correctly identifies the risk that can be reduced through diversification.

A Well-Diversified Portfolio Has Eliminated Most of The