n NISM Certifications
NSM General NISM
Medium

Which of the following best describes 'Diversification' in investing?

Practice question from NISM Series I - Mock Test 1 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. Spreading investments across various assets to reduce risk

    Correct answer

  2. B

    Investing all funds in a single asset

  3. C

    Having a high concentration in one sector

  4. D

    Selling off assets to minimize taxes

A full explanation for this question is being written. In the meantime, the correct answer is highlighted above.

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