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How is hedging different from diversification? a

Finance

How is hedging different from diversification?

a. Through hedging, we try to manage the systematic risk of a portfolio, whereas, through diversification, we try to reduce the unique risk.
b. Through hedging, we try to manage the unique risk, whereas, through diversification, we try to manage the systematic risk of a portfolio.
c. Through hedging, we try to reduce both the systematic and the unique risk.
d. Through diversification, we try to reduce both the systematic and the unique risk.

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