Question

____ is a portfolio characteristic which leads to reduced risk with good return.

a. maturity
b. price-earnings ratio
c. diversification
d. stratification
e. duration

Answer 1

The correct answer is letter "C": diversification.

Step-by-step explanation:

Diversification is a technique in which different types of assets are included within the same portfolio. This is done to reduce the risk of being exposed to the changes of only one security and it is said to provide higher yields in the long term. Typical assets considered in a portfolio are stocks, bonds, real state, Exchange-Traded Funds (ETFs), and commodities.

Answer 2

The correct answer is letter c, diversification. Diversification is being defined as an action of engaging to becoming a varied or more diverse or that it is a process by which an organization engages to in enlarging products, services, or their field of operation.