Buying Securities in a Portfolio with Price Patterns Over Time

question 111

Multiple Choice

Buying securities in a portfolio with price patterns over time that are different from one another, which reduces the volatility of the portfolio, is called _____.

• A) diversification
• B) sensitivity
• C) domestication
• D) speculation
• E) syndication

---

Definitions:

Non-constant Growth

A situation in which a company's dividends or earnings are expected to grow at varying rates over time, as opposed to at a constant rate.

Zero Growth

A situation in which a company or economy sees no increase in income, output, or other measures of financial performance over a period.

Common Stockholders

Owners of common shares in a corporation, having voting rights and potentially receiving dividends.

Cumulative Preferred

Refers to preferred stock where dividends that were not paid in the past must be paid out to preferred shareholders before dividends can be distributed to common shareholders.