Two Risk Assets Can Be Combined to Lower the Overall

question 42

Multiple Choice

Two risk assets can be combined to lower the overall risk of a portfolio.This principle is commonly referred to as

• A)blending
• B)asset allocation
• C)diversification
• D)portfolio segmentation
• E)none of the above

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Definitions:

Appearance and Behavior

The outward presentation of oneself combined with actions, both of which are often used to make judgments about character.

Problem Representation

The way in which a problem is conceptualized or framed, which can affect how it is understood and tackled.

Algorithms

Step-by-step procedures or formulas for solving problems or completing tasks.

Heuristic

A problem-solving strategy that uses a practical method or various shortcuts to produce solutions that may not be optimal but are sufficient for immediate goals.