As the Number of Securities in a Portfolio Is Increased

question 6

Multiple Choice

As the number of securities in a portfolio is increased, what happens to the average portfolio standard deviation?

• A) It increases at an increasing rate.
• B) It increases at a decreasing rate.
• C) It decreases at an increasing rate.
• D) It decreases at a decreasing rate.
• E) It first decreases, then starts to increase as more securities are added.

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Definitions:

Islamic Fundamentalist

An Islamic fundamentalist is someone who adheres strictly to the foundational principles of Islam and often seeks to implement sharia law in societal governance.

Jihad

An Arabic term meaning "struggle" or "striving," especially with a praiseworthy aim, often used in the context of religious duty in Islam.

Spiritual Community

A group of individuals who share common religious or spiritual beliefs and practices, often gathering for worship, support, and communal activities.

Cultural Imperialism

The practice of promoting and imposing a culture, usually that of a politically powerful nation, over a less powerful society.