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Maksim231197 [3]
3 years ago
8

What are the 3 advantages to a diversified portfolio?

Business
1 answer:
Gala2k [10]3 years ago
3 0

Answer:

1. Minimizing Risk,  2. Generate profits 3. Preservation of Capital:

Explanation:

<u>1. Minimizing Risk</u>

Every investment opportunity has its share of risk. Having a diversified portfolio shield from unforeseen market events.  If one class of investments perform poorly, other groups may do well, thereby reducing the loss impact.

<u>2. Generate Profits  </u>

Diversification means investors will be relying on several investment tools for returns. Some markets may not respond as the investor expects. Should some markets not do well, an investor will be assured of profits from the rest.

<u>3. Preservation of Capital</u>

The main aim of investing is to make profits, preserving capital is as equally important.  Every investor must be careful not to lose all his capital. Having a diversified portfolio helps protect wealth.

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Answer:

Total cash flow $54,613

Explanation:

The computation of the year 4 cash flow is given below:

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So,  net cash flow from the sale of equipment  

= $6,920 - $307

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Now year 4 cash flow is  

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Release of working capital  $6,000

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Total cash flow $54,613

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3 years ago
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Answer:

indirect

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4 0
2 years ago
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Answer:

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