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How does diversification reduce risk

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Reference no: EM131406160

Discussion Question

Explain the relationship between risk and return.

How does diversification reduce risk? Give an example of how diversification can reduce risk in a portfolio.

Remember that this is a corporate finance class, not a personal finance class. Substantive responses will focus on corporate or large investors, investment managers and similar situations not personal investments such as 401ks, personal portfolios etc.

Reference no: EM131406160

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