Question
Devante inherited $20,000 from his grandparents and decided to invest it in the stock market. A friend who is a financial advisor told him to invest in several different stocks. Why did he recommend this strategy?
A.
Ensure the chances of higher returns on his investment.
B.
Diversify his investment to reduce risk.
C.
Gurantee a profit on his investment.
D.
Poor advice, concentrate on one stock.
A.
Ensure the chances of higher returns on his investment.
B.
Diversify his investment to reduce risk.
C.
Gurantee a profit on his investment.
D.
Poor advice, concentrate on one stock.
Answers
B. Diversify his investment to reduce risk.
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