Valerie has money to invest in the stock market. She chooses to invest in a mutual fund composed of several companies to reduce risk. Which term best describes what Valerie has done with her money?

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03-01-2022
Business

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Valerie has money to invest in the stock market. She chooses to invest in a mutual fund composed of several companies to reduce risk. Which term best describes what Valerie has done with her money?

Sagot :

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Parrainidn Parrainidn · Answer 1 · 2022-01-07T07:38:30-05:00

The term that best describes Valerie's actions of trying to reduce risk is called Diversification.

The process of diversification:

Involves investing in various assets instead of a few.
Reduces risk that one will lose assets in one investment.

By investing in a mutual fund, Valarie diversified her investment because mutual funds invest in several different assets to ensure that their clients do not lose money on a few investments.

In conclusion, this is diversification.

Find out more on diversification at https://brainly.com/question/417234.

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