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CFA Level 1
Portfolio Management

Understanding Portfolio Diversification

Easy Portfolio Risk And Return Portfolio Diversification

James is an investor looking to minimize the risk of his investment portfolio. He recently read about the benefits of portfolio diversification and wants to apply this strategy to reduce the impact of individual asset volatility on his overall return.

Which of the following statements best exemplifies the concept of diversification in portfolio management?

Hint

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Correct9.4K
% Correct47%