Diversification is investing in a variety of assets with which one of the following as the primary goal?
A) increasing returns
B) minimizing taxes
C) reducing some risks
D) eliminating all risks
E) increasing the variance

Question

Quizplus · Accepted Answer

Diversification is primarily used to reduce the risk of investment by investing in a variety of assets that do not correlate with each other. This reduces the overall risk of the portfolio as a whole, without sacrificing potential returns, and is a common strategy used by many investors.

Diversification Is Investing in a Variety of Assets with Which