Asked by Preet Sangha on May 07, 2024
Verified
Eliminating unsystematic risk is the responsibility of the individual investor.
Unsystematic Risk
The risk that is specific to a company or industry, which can be reduced through diversification.
Individual Investor
An individual investor is a non-professional private investor who buys and sells securities for their personal account.
- Analyze the impact of portfolio diversification on risk management.
- Recognize the significance of achieving a well-diversified investment portfolio.
Verified Answer
DD
Destiny DvorakMay 14, 2024
Final Answer :
True
Explanation :
Unsystematic risk, also known as specific or diversifiable risk, is unique to a particular company or industry. Individual investors can reduce or eliminate this type of risk through diversification of their investment portfolio across various sectors and asset classes.
Learning Objectives
- Analyze the impact of portfolio diversification on risk management.
- Recognize the significance of achieving a well-diversified investment portfolio.
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