Use the Information for the Question(s)below

Use the information for the question(s)below.
Consider an economy with two types of firms, S and U. The S firms always move together, but U firms move independently of each other. For both types of firms there is a 70% probability that the firm will have a 20% return and a 30% probability that the firm will have a -30% return.
-What care, if any, should be taken when selecting shares for an investment portfolio?
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