Diversification is a strategy to reduce risk by spreading investments across various assets, which allows investors to reduce firm-specific risk while leaving systematic market risk that cannot be diversified away.

Authors

• Person: Not available Organization: Pressbooks
  Chapter 8 – Risk and Return – Fundamentals of Finance

Sources

• Chapter 8 – Risk and Return – Fundamentals of Finance pressbooks.pub Pressbooks via serper

Referenced by nodes (3)

• risk concept
• firm-specific risk concept
• diversification concept