diversification
Diversification is a foundational mechanism of Modern Portfolio Theory, as it is used to construct optimal portfolios along the 'efficient frontier' [1] and serves as a core principle introduced by Harry Markowitz in his seminal work on the theory [2]. Furthermore, the two concepts are intrinsically linked as the origins of risk-return tradeoffs [3], though failing to properly implement diversification within the framework can lead to inaccurate risk assessments [4]. — 4 supporting facts
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