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11) If a stock portfolio is well diversified, then the portfolio variance: A) will equal the variance of the most volatile stock in the portfolio B) may be less than the variance of the least risky stock in the portfolio C) must be equal to or greater than the variance of the least risky stock in the portfolio D) will be a weighted average of the variances of the individual securities in the portfolio E) will be an arithmetic average of the variances of the individual securities in the portfolio

Respuesta :

Answer:

B) may be less than the variance of the least risky stock in the portfolio

Explanation:

In the case when the portfolio of the stock is well diversified so the variance of the portfolio should be less as compared to the variance that have less risky stock because if we diversify the risk so it would lead in the less risk for the total portfolio

Therefore the option b is correct

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