Intermediate Financial Accounting II
Portfolio diversification is an investment strategy aimed at reducing risk by allocating investments across various financial assets, industries, or other categories. The main idea is that a well-diversified portfolio can reduce the overall volatility of returns, as the performance of different assets often does not move in tandem. This strategy is crucial for achieving stable expected returns on plan assets, as it helps mitigate the adverse effects of poor performance in any single investment.
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