Why is diversification important for reducing risk

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John owns five stocks: United Healthcare, Pfizer, Johnson & Johnson, CVS Health, and Merck. Get the instant assignment help. Sara owns five stocks: Microsoft, Coca-Cola, Netflix, Amazon, and Nike. Based on the industries these companies operate in, who has a more diversified portfolio, and why is diversification important for reducing risk in an investment strategy?

Reference no: EM133926834

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