Question 1 of 8
A portfolio concentrated in a single sector is more likely to outperform a diversified portfolio.
Question 2 of 8
Modern Portfolio Theory suggests diversification reduces unsystematic risk.
Question 3 of 8
The S&P 500 contains stocks from only one industry sector.
Question 4 of 8
Holding 5-10 stocks across different sectors is considered adequate diversification for most investors.
Question 5 of 8
Bonds and stocks typically move in the same direction during market volatility.
Question 6 of 8
Asset allocation (stocks, bonds, real estate) matters more than individual stock selection.
Question 7 of 8
Diversification completely eliminates market risk.
Question 8 of 8
International stocks can provide diversification benefits to a US-focused portfolio.