Diversification

Definition:

Dividing investment funds among a variety of securities with different risk, reward, and correlation statistics so as to minimize unsystematic risk.

Investing Essentials


Copyright © 2011 Campbell R. Harvey, Professor of Finance, Fuqua School of Business at Duke University

Term of the Day

Special Claim on Residual Equity (SCORE)

A certificate that entitles the owner to the capital appreciation of an underlying security, but not to the dividend income from the security.

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