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If an FIs Trading Portfolio of Stock Is Not Well-Diversified

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If an FIs trading portfolio of stock is not well-diversified, the additional risk that must be taken into account is


Definitions:

Rate of Return

The upward or downward movement in an investment's worth over an agreed-upon duration, quantified as a percentage of the investment's original price.

Shares

Units of ownership interest in a corporation or financial asset that provide a proportionate claim on the company's profits and assets.

Stock Listing

The process of adding a company's shares on a public stock exchange, allowing them to be bought and sold by investors.

Closing Price

The final price at which a stock is traded on a given trading day.

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