The Statement "A Portfolio Is Less Than the Sum of Its

Multiple Choice

The statement "A portfolio is less than the sum of its parts." means

A) it is less expensive to buy a group of assets than to buy those assets individually.
B) portfolio returns will always be lower than the returns on individual stocks.
C) a diversified group of assets will be less volatile than the individual assets within the group.
D) for reasons that are not well understood, the value of a portfolio is less than the sum of the values of its components.