Which of the following investment instruments would a risk-averse individual choose?
A) stocks that are negatively correlated with the rest of one's portfolio
B) agricultural stocks in a foreign agricultural economy
C) oil stocks
D) technology stocks

Question

Quizplus · Accepted Answer

A risk-averse individual would choose stocks that are negatively correlated with the rest of their portfolio. This hedging strategy can help to reduce overall risk and volatility in the portfolio. Agricultural and oil stocks are typically more volatile, while technology stocks may be more risky due to fast-changing technology and market competition.

Which of the Following Investment Instruments Would a Risk-Averse Individual