Investors include various assets in the portfolio,to ________ the variability of the portfolio's returns.

Question

Quizplus · Accepted Answer

Investors include various assets in the portfolio to decrease the variability of the portfolio's returns. This is known as diversification, and it reduces the risk of losses by spreading investments across different industries, currencies, and types of securities. By combining assets with varying risk and return profiles, the overall volatility of the portfolio is reduced, leading to a more stable performance over time.

Investors Include Various Assets in the Portfolio,to ________ the Variability