The primary benefit of diversification is that it
A)is convenient.
B)is cheaper.
C)reduces the exposure of your investments to adverse effects of any individual investment.
D)increases stock volatility.

Question

Quizplus · Accepted Answer

Diversification reduces the exposure of your investments to adverse effects of any individual investment, making your portfolio less vulnerable to the volatility of any one investment. This helps mitigate risk and potentially increase returns over time. A, B, and D are not accurate benefits of diversification.

The Primary Benefit of Diversification Is That It