Examlex
In a MAF system, which of these statements is correct?
Diversification
A risk management strategy that mixes a wide variety of investments within a portfolio to minimize the impact of any single investment's performance.
Portfolio Theory
A framework for constructing a portfolio of assets in such a way that it optimizes the balance between risk and return.
Risk Aversion
The reluctance to take on investments with higher levels of uncertainty or potential for loss.
Accepting Risk
Accepting risk involves recognizing and undertaking the chance of loss or damage in the expectation of a potential gain.
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