Difference between market risk and idiosyncratic risk

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1. What is the difference between market risk and idiosyncratic risk?

2. What is diversification? How does it reduce the risk of a financial portfolio?

3. In 2010, Google founders Larry Page and Sergey Brin sold some of their stock in the company Google issued a statement that Page and Brin's stock sales were "part of their respective longterm strategies for individual asset diversification and liquidity." Briefly explain what the statement means.

Reference no: EM131305443

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