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Indirect diversification benefits |
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Indirect diversification benefitsDiversification benefits provided by the multinational corporation that are not available to investors through their portfolio investment.Indirect diversification benefits Similar MatchesEfficient diversificationEfficient diversificationThe organizing principle of modern portfolio theory, which maintains that any risk-averse investor will search for the highest expected return for any particular level of portfolio risk. DiversificationDiversificationDividing investment funds among a variety of securities with different risk, reward, and correlation statistics so as to minimize unsystematic risk. Naive diversificationNaive diversificationA strategy whereby an investor simply invests in a number of different assets in the hope that the variance of the expected return on the portfolio is lowered. In contrast, mathematical programming can be used to select the best possible investment weights. Related: Markowitz diversification. Sector diversificationSector diversificationConstituting of a portfolio of stocks of companies in each major industry group. Principle of diversificationPrinciple of diversificationThat portfolios of different sorts of assets differently correlated with one another will have negligible unsystematic risk. In other words, unsystematic risks disappear in diversified portfolios, and only systematic risks persist, those related to particular assets. Further SuggestionsCurrency diversificationCone of diversification diversification Markowitz diversification International diversification Liquidity diversification Unique Diversification Benefit Diversification cone |
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