Diversification Can Effectively Reduce Risk

question 24

Multiple Choice

Diversification can effectively reduce risk. Once a portfolio is diversified the type of risk remaining is:

• A) individual security risk.
• B) riskless security risk.
• C) risk related to the market portfolio.
• D) total standard deviations.

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Definitions:

Genotype

The genetic constitution of an individual organism, determining inherited traits and often influencing phenotype.

Genetic Counseling

A medical specialty that helps prospective parents determine the probability that their children will inherit genetic defects and chromosomal abnormalities.

Behavioral Genetics

A discipline that investigates how genetics and environmental factors affect behavior.

Obstetrics

A medical specialty focused on care during pregnancy, childbirth, and the postpartum period.