Diversifying an investment portfolio allows the reduction of unsystematic risk to a minimum.This Statment Is True OR FLSE
Question
Diversifying an investment portfolio allows the reduction of unsystematic risk to a minimum.This Statment Is True OR FLSE
Solution
The statement is True. Diversifying an investment portfolio can indeed help to minimize unsystematic risk. This is because unsystematic risk is the risk that is specific to a particular company or industry. By diversifying the portfolio, an investor can spread this risk across different companies and industries, thereby reducing the potential negative impact on the portfolio if one company or industry performs poorly.
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