Well-diversified portfolios have negligible:

Question

Quizplus · Accepted Answer

A well-diversified portfolio eliminates or significantly reduces unsystematic risks, also known as idiosyncratic risks, which are specific to individual assets. Systematic risks, such as market risk or interest rate risk, cannot be diversified away but have a lower impact on the portfolio when it is well-diversified. Expected returns, variances, and covariances are not negligible but are important factors to consider in portfolio management.

Well-Diversified Portfolios Have Negligible