contestada

The major benefit of diversification is the:
a. increased expected return.
b. removal of all negative risk assets from the portfolio.
c. reduction in the portfolio's total risk.
d. reduction in the portfolio's systematic risk.

Respuesta :

chau23
The answer of this question is D .
Parrain

Diversification has the major benefit of the c. reduction in the portfolio's total risk.

What does diversification do?

Diversification refers to investing in assets whose returns are inversely correlated to allow for the removal of unsystematic risk.

As unsystematic risk is part of the total risk of a portfolio, diversification removing it, leads to a reduction in the total risk.

In conclusion, option C is correct.  

Find out more on systematic risk at https://brainly.com/question/15873445.

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