I’m working on a accounting question and need guidance to help me understand better.
Topic Question/Issue: Based only on the material found in our textbook, please answer the following questions:
(1) Why is diversification considered “good” by most professionals? Can you think of a situation where diversification might be “bad”? Please discuss.
(2) Pick either “passive” or “active” investment management. Which investment style do you personally prefer? Why?